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After Launch of JioMart, WhatsApp is Now Eyeing Digital Money Lending in India

Professor of Financial Economics and Part-time Value Investor, Transfin.
Apr 29, 2020 7:18 PM 4 min read
Editorial

WhatsApp eyeing digital money lending in India. Samsung reports slight decline in Q1 net profit. Strides Pharma says Favipiravir can be used against coronavirus. Alphabet reports Q1 revenue growth of 13% YoY.

 

 

 

SIGN OF THE TIMES

FMCG firms embrace direct-to-home selling amidst lockdown. 

Last Mile Blues

The pandemic has forced India to go into lockdown and the lockdown has forced traditional trade and distributor networks into total disarray. This has in turn compelled more than a dozen consumer goods companies to start selling directly to consumers by partnering with startups like Dunzo, Scootsy and Swiggy or reaching out to resident welfare associations (RWAs) through their sales staff. These FMCG firms include Hindustan Unilever, ITC, Mondelez, Procter & Gamble, Dabur and Colgate. [ET Tech]

 

More Indian investors venture into US stocks as markets slump at home. 

Contingency Amidst Crises

Indian markets are experiencing many things these days, including slumps and volatility. Investor optimism is not one of them. As markets at home tumble, more and more Indian investors are turning to US stocks and picking up exposure to global tech giants amidst the COVID-led turmoil. Read more on this trend here. [Reuters]

 

COMPANIES

Flipkart partners with Meru to deliver essentials. 

Meru and Me

E-commerce giant Flipkart and ride-hailing platform Meru have tied up to deliver grocery and essential items to customers amid the nationwide lockdown.

 

Under this partnership, Meru will deliver grocery and essentials to Flipkart customers across Bengaluru, Delhi, NCR, and Hyderabad. [Yourstory]

 

Samsung reports slight decline in Q1 net profit.

A Giant's Miss

South Korean tech giant Samsung Electronics has reported a slight decline in its Q1 net profit despite increased computing demand for its memory chips.

 

The company has also warned that the impact of the coronavirus pandemic could further threaten the company’s earnings the rest of the year. 

 

Samsung, the world’s largest smartphone and memory-chip maker reported dip in Q1 net profit to 4.88trn South Korean won ($3.99bn) vs 5.04trn won last year.

 

Revenue rose about 5.6% during the same period a year ago. [WSJ]

 

COVID-19

Strides Pharma says Favipiravir can be used against coronavirus. 

Is This The One?

Global pharmaceutical company Strides Pharma Science Limited has said it has developed and commercialised Favipiravir antiviral tablets, which were found effective to fight COVID-19. Favipiravir, which is an antiviral medication that was initially developed to treat influenza in Japan, will now begin to be exported by the company. It has reportedly shown positive results when used in experiments against the coronavirus. [Hindu BusinessLine]

 

Can job loss insurance help you if you get laid off? 

Be Prepared

One of the most negative consequences of the coronavirus pandemic has been the pay cuts and layoffs. If you’re concerned about your professional future, you might want to know about something called “job loss insurance”, which might help keep you afloat during the time you’re between jobs. However, it has many caveats and conditions for eligibility.

 

If you are thinking about buying a job-loss cover, here is everything you need to know. [ET Wealth]

 

INVESTMENTS

Mutual funds liquidate holdings in perpetual bonds issued by banks.

Reeling Under Pressure

Franklin Templeton Mutual Fund last week closed six debt schemes citing lack of liquidity in the debt market and unprecedented redemptions in these yield-oriented schemes. Here's all you need to know about the fiasco. [TRANSFIN.]

 

Following this, other mutual fund houses have also been under immense redemption pressure and have been liquidating their holdings in perpetual bonds issued by banks. This has sent yields on these paper surging.

 

Mutual funds were seen dumping additional tier 1 bonds of public sector banks in the secondary market at steep discounts.

 

Perpetual bonds issued by Union Bank of India, Canara Bank and Bank of Baroda were sold in the range of 11.50-14%, nearly 100-350 basis points above their coupon, said market participants. [Livemint]

 

WhatsApp eyeing digital money lending in India. 

We'll Do It All...Everything

WhatsApp is reportedly eyeing digital money lending in India. 

 

Facebook-owned WhatsApp has listed to offer “advance money or give credit on such terms as may seem expedient, and with or without security, to customers and others” as one of the areas that it is looking to explore, in a Ministry of Corporate Affairs filing earlier this month.

 

The news comes shortly after Facebook invested $5.9bn in Reliance Jio. As part of the partnership, JioMart has started selling groceries through WhatsApp.

 

FYI

WhatsApp has been testing its UPI-based payments service in India since 2018 but is still awaiting regulatory approval from authorities for a full-fledged commercial launch. [Financial Express]

 

ALPHABET

Tech giant reports Q1 revenue growth of 13% YoY. 

Happy-Sad

One of the world’s largest companies expects a difficult quarter ahead.

 

Alphabet reported quarterly revenue on Tuesday, and the numbers beat analysts’ estimates on the positive side despite the economic slowdown from the novel coronavirus. Alphabet’s overall revenue in the first quarter was $41.2bn, up 13% YoY.

 

But it expects the coming quarter to be difficult. 

OK Google, When Will This All End?

Nonetheless, the tech behemoth expects a rocky second quarter ahead. In recent years its swift growth was fed by a booming economy and rising internet usage. The pandemic has split these two trends, with consumer spending and confidence plunging even as internet usage surges. [Reuters]

 

Analysts have also warned of “near-term economic impacts” at Alphabet, highlighting Google and YouTube’s “particular exposure to travel, media & entertainment, retail, finance, and, automotive verticals.” [CNBC]

FIN.

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