Jio: Short-lived low costs?

77

What is it? The number of terrorists killed in Jammu & Kashmir till June 12 this year, as compared to 54 in corresponding period last year.

Why is it important? This could be due to more locals joining the terrorist groups, and also higher success of counter-terrorism activities underway in the valley.

Tell me more: Today is the first death anniversary of Burhan Wani, a self-styled commander of Hizbul Mujahideen. His death sparked huge protests with 820 incidents of stone-pelting reported in July last year.

 

 

Rs 1,680 crore

What is it? The fresh investment by Amazon, the largest online retailer in the world, in its Indian business, Amazon Seller Services.

Why is it important? The investment takes Amazon’s total India capital to over Rs 13,800 crore or over $2 billion since launch in June, 2013. It is not only a part of Amazon’s commitment to spend $5 billion in India, but also makes it the second largest global investor to put money on India’s digital economy. The Japanese SoftBank leads with around $4 billion in various investments.

Tell me more: The last infusion by Amazon was in December, 2016 of Rs 2,010 crore.

 

 

Rs 44,800 crore

What is it? The revenue Reliance Industries’ Jio, the telecom venture, needs to earn to break even in earnings with profit before tax (PBT), according to Kotak Institutional Equities.

Why is it important? The requirement, based on FY17 expenditure, debt and asset base, is not much lower than established competition, belying its reported low-cost model. Much larger competition in subscribers and revenues, Bharti Airtel, needs around Rs 49,000 crore while Idea Cellular needs Rs 37,000 crore, based on FY17 spending and regulatory fees.

Tell me more: The revenue required to break even at the Ebitda level is, however, lower than competition. While Bharti Airtel needs around Rs 31,000 crore and Idea Cellular Rs 24,000 crore to break even at the Ebitda level, Jio needs Rs 22,400 crore.

 

 

Rs 43,000 crore

What is it? The total revenue earned by the Indian Railways in April-June, this year.

Why is it important? This is 11% higher when compared to corresponding revenue numbers last year. Both passenger and freight earnings increased. While passenger earnings rose from Rs 12,000 crore to Rs 14,000 crore in this period due to the dynamic pricing in premium trains, freight income rose from Rs 25,000 crore to Rs 28,000 crore.

Tell me more: The IR has set Rs 1.89 lakh-crore as its FY18 revenue target..

 

 

53.1

What is it? June’s Nikkei India Services Purchasing Managers’ Index, a private survey.

Why is it important? Unlike the manufacturing index, services sectors fared better as the index rose to an eight-month high. New business, recruiting and higher selling prices led to the uplift.

Tell me more: The index rose from 52.2 in May. A value of 50 and above means expansion signalling an increase in services activity.

Read More

News in Numbers, June 23, 2016: East’s answer to NATO, India’s largest spectrum auction…

8

What is it? The membership strength of the Shanghai Cooperation Organization (SCO) once India and Pakistan join the group at a two-day summit starting today.

Why is it important? It’s East’s answer to NATO (North Atlantic Treaty Organisation). This would help India participate in military cooperation in the areas of counter-terrorism measures in Central Asia, intelligence sharing and tackling cyber terrorism with the member-states of this group. This would also provide better access to Central Asia for both India and Pakistan at a time when they are seeking to deepen their ties with the region, especially given their involvement in projects such as Chabahar Port and China-Pakistan Economic Corridor respectively.

Tell me more: The SCO comprises of China, Russia, Kazakhstan, Kyrgyzstan, Russia, Tajikistan and Uzbekistan while Afghanistan, Belarus, India, Iran, Mongolia and Pakistan have observer status.

 

$950,000

What is it? The penalty the US’ Federal Trade Commission (FTC) has levied on mobile advertising company InMobi for tracking locations of consumers including children without their permission.

Why is it important? Shows how some new-age firms resort to practices deemed to be unethical and illegal to chase growth. Highlights the risks to consumers who have no way of knowing if their privacy (and their children’s privacy) is being compromised. For InMobi, which is competing with Facebook and Google, this comes at a time when it is struggling to raise funds, build a sustainable business model and fighting attrition in its senior and mid-level management.

Tell me more: Under the terms of settlement, the FTC said InMobi is subjected to a $4 million civil penalty, which is suspended to $950,000 given the “company’s financial condition”. InMobi has to delete all information collected from children and location information of consumers besides instituting a comprehensive privacy policy, which will be independently audited every two years for the next 20 years.

 

Rs 5.66 lakh crore

What is it? The amount the spectrum auction is estimated to fetch the Indian government.

Why is it important? Given how expensive the spectrum bands are (a firm bidding for 5 MHz of pan-India bandwidth in the 700 band would have to pay Rs 57,000 crore– over half of what the government earned from the 2015 auctions) and the Rs 3.5 lakh crore debt under which the telecom sector is reeling, the level of participation by the firms in the auctions remains to be seen. Idea, Vodafone and Airtel are reportedly not planning to bid for spectrum in the 700 MHz band.

Tell me more: This is the first time the government would put up the entire spectrum available on sale. The bidding is expected to commence from September 1.

 

Rs 418.25 crore

What is it? Revenue of ANI Technologies, which owns and runs brand Ola, in 2014-15.

Why is it important? It increased eight-fold from Rs 51.05 crore in 2013-14 though its losses shot up 20 times from Rs 34.21 crore in FY14 to Rs 754.87 crore in FY15. Indicates that the growth of the company, which raised two rounds of funding totalling to $251.5 million (nearly Rs 1,700 crore) in this period, came at a high cost (discounts and driver incentives) and that it requires increased capital to fend off competition from Uber and maintain its lead.

Tell me more: Ola is reportedly in talks with investors to raise $300-400 million or $1 billion, according to different publications.

 

57%

What is it? Percentage of cost of travel recovered by the Indian railways on passenger fares on an average.

Why is it important? The railways has been printing this information on train tickets in the last one week. The idea is to make rail passengers aware of the huge subsidy on rail tickets. Increasing rail fares is a politically sensitive subject in India and this awareness-building could be the first step in rationalisation of fares in the coming years.

Tell me more: Passenger fares were last hiked by 14.2% in June 2014. Suburban and short-haul train passengers account for over half of the traffic but their share in total passenger revenues was just 6-7%, accounting for around 60% of the annual subsidy of Rs 34,000 crore.

Read More