Top News: Govt May Exit Air India, ShareChat Raises $100m in Funding Round Led by Twitter, Alibaba Reports Rise in Revenue

Govt agrees in principle to sell 95% stake in Air India. Air India puts to auction more than 60 real estate assets. Hopeful that all 19 of its grounded aircraft will rejoin the fleet by October. Yes Bank plans to raise additional $600m after raising $270m from marquee investors. ShareChat raises $100m in Series D funding round led by Twitter. Hero MotoCorp plants to remain shut for 4 days till Aug 18. TV sales decline despite discounts. Alibaba reports 42% rise in revenue in Q1. Walmart International posts c. 30% decline in operational income.

 

Moving on to the top Business news stories of the day:

 

 AIR INDIA 
 
Govt agrees in principle to sell 95% stake in Air India. Air India puts to auction more than 60 real estate assets. Hopeful that all 19 of its grounded aircraft will rejoin the fleet by October. 

Let it Go: A Committee of Secretaries led by Cabinet Secretary P K Sinha has agreed in principle to sell 95% in Air India, retaining 5% for ESOP of permanent employees. The proposal will now be put up for approval of the Committee of Ministers in the next 15 days.
 
Fresh Attempt: Following failed attempts in 2001 and 2018, the government is now doing all it can to ensure that the Air India sale is successful, including reducing the debt burden for the potential buyer and rewriting the rules of the privatisation process.
 
Air India has put to auction more than 60 real estate assets, including some it could not sell at its last auction in April.
 
The last date for submitting bids is 30 August, according to a tender document issued by the airline.
 
Where There is Hope, There is a Way: The national carrier is hopeful that all 19 of its grounded aircraft will rejoin the fleet by October, as it plans to commence flight operations to Africa and Canada.
 
 
 YES BANK 
 
Yes Bank plans to raise additional $600m after raising $270m from marquee investors.
 
 
The What: In an attempt to bolster its coffers, Yes Bank is planning to raise an additional $600m from large investors. The additional capital will be crucial for the bank if it has to comply with capital adequacy regulations.
 
 
The fundraise would be in addition to the $270m raised by the lender in its qualified institutional placement (QIP) offering that closed on Wednesday. 
 
 
This may not be sufficient, though. In a note in July, Jefferies India estimated that the bank would need $3-4bn over the next three years. 
 
 
However, in the backdrop of a slowing economy and liquidity crunch in the banking and NBFC sector, Yes Bank is likely to be under pressure in the coming period.
 
 
 STARTUPS 

ShareChat raises $100m in Series D funding round led by Twitter. 
 
 
Sharing Joy: Bengaluru-based regional language social platform, ShareChat, has raised $100m in its latest round of financing led by Twitter. This brings the total capital secured by the company till date to $224m.
 
 
Other than Twitter, TrustBridge Partners, and existing investors Shunwei Capital, Lightspeed Venture Partners, SAIF Capital, India Quotient and Morningside Venture Capital also participated in the Series D round.
 
 
A New Spin: Top scooter rental companies - Vogo, Bounce and Drivezy - are increasingly adopting the asset-light business model. These firms have tapped a handful of companies to own the thousands of scooters that run on their platforms. The obvious advantage - assets, scooters in this case, go off-book, even as they still get a reliable supply of vehicles.
 
 
Here’s a closer look at the business models of these scooter rental companies.
 
 
 CONSUMER 

Hero MotoCorp plants to remain shut for 4 days till Aug 18. TV sales decline despite discounts. 
 
 
On a Sabbatical: India’s largest two-wheeler maker, Hero MotoCorp, in a regulatory filing has said that its manufacturing plants have been shut for four days till August 18 as part of an annual routine. The time off will also be taken to adjust production in line with the current market demand which has seen a massive slump in the recent times. 
 
 
Hero MotoCorp has been reducing its production due to decline in sales. In the April-July period this year, its production was at 24,66,802 units, down 12.03% vs last year.
 
 
...And They All Fall Down: TV sales were down by at least 20% in value and 15% in volume in the April-June quarter despite deep discounts, as per the local arm of Japanese electronics firm Panasonic. 
 
 

Earlier this month, the RBI had noted that consumer confidence had dipped in July as households remained pessimistic about jobs and the economy.
 
 
 EARNINGS 

Alibaba reports 42% rise in revenue in Q1. Walmart International posts c. 30% decline in operational income. 

 
Some Hits: Chinese ecommerce giant Alibaba reported 42% rise in revenue to 114.92 billion yuan ($16.3bn) in Q1, beating analysts expectations, up from 80.92 billion yuan, a year earlier.  
 
 
Net profit for the quarter was 21.2 billion yuan ($3.1bn), more than double from the same period a year earlier.
 
 
The news comes at a time when the Chinese economy at large is witnessing an accelerating slump on back of the US-Sino trade wars. 
 
 
Some Misses: Walmart International, the segment which consists of the retail giant’s operations outside US including retail websites posted 29.6% decline in operational income and 27.3% decline in constant currency, primarily to the expected margin dilution from Flipkart as well as the overall gross margin pressure.
 
 
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