Also in the letter:
■ NCLT on Byju’s lenders’ plea
■ India Inc’s gender diversity push
■ Shedding light on dark stores
Retailers and ecommerce firms clash over festive season discounts
The rivalry between offline retailers and ecommerce firms has reignited as the festive season approaches. Retail stores are concerned that online channels will affect their business by offering heavy discounts.
Protecting interests: Industry bodies representing over 158,000 electronics and mobile phone retailers have written to top smartphone manufacturers including Samsung, Motorola, Realme, OnePlus, electronics companies like LG and Whirlpool, saying that if they resort to predatory pricing, it could dent offline players’ business by up to half.
The All India Mobile Retailers Association (AIMRA), which represents over 150,000 mobile stores, has specifically alleged that Samsung, Realme and OnePlus favour online channels.
Tell me more: In August, an industry body comprising 40 retail chains including Girias and Pai Electronics, wrote to LG, Samsung, Apple etc, asking them to ensure products are not sold at “ridiculous prices” in online marketplaces. They also demanded the same cashback and EMI schemes across all channels.
Offline retailers, including large regional chains, have combined annual revenues of over Rs 70,000 crore.
Festive rush: With demand slowing in these categories this year, both offline and online channels are relying on a festive boost. Smartphones and consumer electronics sales during the festive period account for about 30% of annual sales for brands.
Also Read | Premium consumer electronics sales growing faster online than in stores
Decoding Nvidia’s $279 billion market cap erosion
Shares of chip titan Nvidia tumbled 9.53% on Tuesday with investors turning cautious over the artificial intelligence (AI) frenzy. The company’s market capitalisation declined by $279 billion, marking the steepest single-day fall for an American company.
By the numbers: The company’s market capitalisation stood at $2.65 trillion after Tuesday’s close. Shares of Nvidia have been on a decline over the last week, delivering a negative 13.65% return over the last five days.
Source: Google
Driving the fall:
- US antitrust probe: The US Department of Justice has sent a subpoena (legally binding request) to Nvidia as it probes the company for antitrust practices. Nvidia maintains that it plays fair in the AI chips market.
- Lacklustre earnings report: Investors’ latest jitters come after the company gave a quarterly forecast that failed to meet analysts’ expectations, despite steady growth and profit.
- Weakness in chip stocks: The selloff extended to Wall Street’s chip index, which dropped 7% as investor optimism about AI softened.
Concerns over AI boom: Worries about delayed payoffs from hefty AI investments have impacted Nvidia’s market capitalisation. The company is in talks to invest in OpenAI as part of a new fundraising round that could value the ChatGPT maker above $100 billion.
Byju’s insolvency case: NCLT rejects US lenders’ plea to stop CoC proceedings
The Bengaluru bench of the National Company Law Tribunal (NCLT) deferred the matter between Glas Trust, which represents a group of US lenders to Byju’s, and insolvency resolution professional (IRP) Pankaj Srivastava.
Additionally, it rejected the lenders’ plea to stop the proceedings of the Committee of Creditors (CoC), saying that it was allowed by the Supreme Court on August 21.
Driving the news: The matter is about Glas Trust’s removal from the committee of creditors by IRP Srivastava. Glas Trust has challenged this and is also seeking Srivastava’s removal from the post.
On Tuesday, in the CoC’s first meeting, the IRP for Byju’s removed Glas Trust from its panel, concluding that it does not represent the minimum 51% of lenders in the consortium that provided a $1.2-billion term loan to the edtech, sources told us.
‘Fraud’: The lenders said Srivastava moved the first CoC meeting 9 hours before schedule without informing Glas Trust or its advisors. “He (Srivastava) holds the meeting at 10 am and then says you are disqualified at 10:50 am; what else is this but fraud,” Glas Trust’s counsel said in the NCLT.
The bench has now deferred the matter till September 11, saying it will proceed on that date if the matter does not come up in the apex court by then.
Background: The Supreme Court is also hearing an appeal by Glas Trust, opposing Byju’s Rs 158-crore settlement with the Board of Control for Cricket in India (BCCI). The SC on August 14 stayed the National Company Law Appellate Tribunal’s order that had quashed bankruptcy proceedings against the company and approved the BCCI settlement deal.
India Inc extends gender diversity push to temporary hiring for festive season
India Inc’s big gender diversity push is increasingly getting extended to temporary hiring during peak periods such as the festive season.
Festive hiring boom: Diversity hires have spiked 15-35%, and even more in sectors such as ecommerce and retail where the rise is nearly twofold.
Nitin Dave, CEO, Quess Staffing, said some companies that depend on assembly line operators are hiring 100% women while automotive sector firms are aiming for at least 30% gender diversity.
“The retail segment has set hiring benchmarks for women in shop promoter roles at around 40%. Ecommerce firms are hiring 60% females for night shifts, showcasing a concerted effort to encourage female participation in the workforce,” he added.
Shifting perspectives: Women workers have comparatively lower attrition and absenteeism rates, contributing to higher productivity during the festive season, said Manu Saigal, director-general of staffing, Adecco India.
At the workforce solutions company, these factors have led to a 35% increase in diversity hiring compared to 19% last year, she said.
Infographic Insight: Shedding light on dark stores
The concept of dark stores is gaining traction in the Indian online shopping landscape, as major online platforms seek to expand consumer reach. This has resulted in an increase in rental rates across major cities.
Dark stores, located in city centres and dependent on micro-markets within each city, generally command higher rental rates compared to warehouses. Rental rates range from Rs 40 to Rs 250 per square foot.
Also Read | Cash-rich quick commerce firms rush to grab dark store sites, personnel amid rapid growth
Today’s ETtech Top 5 newsletter was curated by Megha Mishra in Mumbai and Vaibhavi Khanwalkar in Bengaluru.
