SpiceJet Hires 500 Employees of Jet, TikTok App Downloads Surge After Ban in India, Tesla to Shrink Board, Reliance Denies Violation of US Sanctions on Venezuela et al.

SpiceJet hires 500 employees of Jet. Air India to use Jet’s grounded planes. TCS, Infosys, Wipro added 7 times more employees in FY19. Jio to buy spectrum from open market. TikTok app downloads surge on third-party platforms after being banned in India. Tesla to shrink Board to 7 directors from 11, in an attempt to improve corporate governance.

 

Moving on to the top Business stories of the day. 

 

 COMPANIES 

SpiceJet hires 500 employees of Jet. Air India to use Jet’s grounded planes. TCS, Infosys, Wipro added 7 times more employees in FY19.
 

The Good Samaritan: Budget carrier SpiceJet has hired 500 employees, including 100 pilots of grounded carrier Jet Airways.
 

It is open to induct more as the airline looks to add more aircraft and routes in the coming days.
 

Helping Hand: SpiceJet recently also announced the induction of 27 more planes as it aims to expand its fleet. This move is also likely to overcome the capacity deficit due to Jet Airways temporarily withdrawing its domestic and international services and stabilize prices.
 

Pitching In: Air India has volunteered to temporarily use some of Jet Airways’ grounded planes on key international routes. Other airlines too are in talks with aircraft lessors to use Jet’s grounded planes.

 
Welcome Aboard: Tata Consultancy Services (TCS), Infosys and Wipro together added over 64,805 (after taking into account the attrition) new employees in FY19 vs 9,864 in FY18 and 48,350 in FY17.
  

This quantum jump in hiring can be attributed to robust campus placements, in addition to the localisation initiatives they have been pushing in different client geographies, including the US.
 

Aggressive hiring (especially the fresher intake) is expected to continue this fiscal as the companies try to cash in on the emerging demand in the market.

 

 CRUDEOIL 

Reliance denies violation of US sanctions on Venezuela. Not involved in any cash payments to Venezuela's PDVSA, bought oil with knowledge of US authorities. BP to lead $6bn of fresh investment in Azeri oil project. 
 

Not in Violation: Reliance Industries has said that it is not in violation of the US sanctions on Venezuela and denied involvement in any arrangements that lead to cash payments for oil supplies to Venezuelan state oil company PDVSA via third parties. 
 

It said that it had purchased crude originating from the Latin American nation from companies such as Russia's Rosneft in full knowledge of US authorities.

Zooming Out: The US imposed economic sanctions on Venezuela in late January 2019 in an attempt to curb the country's crude exports and put pressure on President Nicolas Maduro to step down.
 

Leading the Lot: British multinational oil and gas company, BP and its partners will lead a $6bn development of the giant Azeri-Chirag-Deepwater Gunashli oil-field complex offshore Azerbaijan.
 

The Azeri Central East project in the Caspian Sea, which includes a new offshore platform and facilities designed to process up to 100,000 barrels of oil a day, is expected to achieve its first production in 2023 and to produce up to 300 million barrels over its lifetime, BP said.
 

BP operates and has a roughly 30% stake in the complex, while Azerbaijan’s state oil company Socar owns 25%.

 

 RELIANCE 

Jio to buy spectrum from open market. 
 

Change in Strategy: Reliance Jio is set to buy spectrum from the open market. 
 

The development comes as Jio terminated its agreement with Reliance Communications to acquire spectrum from it as the Department of Telecommunications refused to approve the deal.
 

Bleeding Heavily With Losses: RIL has an outstanding debt of INR2,87,505cr and it grew by INR69,000cr in FY 2019 because of its investments in Reliance Jio. While the company has cash reserves worth INR133,027cr on its books, the margin from Jio is not enough to recover these investments in the near future, as per analysts. 

RIL is estimated to have invested around INR3L cr in Reliance Jio so far and another INR1 lakh crore to expand petrochemicals business in Jamnagar. Read more on how Reliance plans to manage its rising debt here.

Busy as a Bee: The last financial year has been the busiest for Reliance’s M&A team in over a decade as the company divested from some core segments and invested in consumer-facing ones. Reliance reportedly dealt with 33 M&As, investment and joint ventures in the last financial year, valued at $2.9bn. More on these deals here.

 

 SOCIALMEDIA 

TikTok app downloads surge on third-party platforms after being banned in India.

No Stopping Us: Downloads of China-based short video sharing app, TikTok surged by about 10-15 times on third-party sites like APKMirror, following its ban in India.
 

APKMirror is a popular website for downloading apps that are not available on the Android app store.
 

Backstory: India banned TikTok on 15 April when the Supreme Court refused to stay an order by the Madras High Court asking the government to ban the app.
 

Tightening the Noose: Legal experts expect regulatory scrutiny over digital platforms to increase in the coming times. However, they say that such regulations must focus on removing illegal content as against removing the app completely.

 

 TECH 

Tesla to shrink Board to 7 directors from 11, in an attempt to improve corporate governance.
 

Shrinking Down: Tesla in a proxy filing said that it would shrink the size of its Board to seven from 11 Directors as part of its ongoing attempt to improve corporate governance. 
 

What You Missed: The phaseout of four directors follows a settlement with the Securities and Exchange Commission last year that required that Elon Musk step down as Chairman for three years and that the company add two independent directors.
 

Also This: Along with shrinking the size of the board, Tesla also laid out a series of shareholder proposals designed to take into account input from institutional investors, including removing a supermajority voting requirement and shortening director terms to two years from three.
 

Good Reads: Shares of business-software firms have soared a median 126% from their debuts through Tuesday’s market close, above high-profile consumer-tech companies with a median 15% increase. This WSJ articles analyses the potential reasons for the difference in reception. 
 

Bonus: With annual revenue of $331m, up 118%,  Zoom was the ultra-rare tech unicorn to make its IPO debut with a profit, boasting 50,000 corporate customers, including Samsung, Uber, Walmart and Capital One. Read this exclusive inside story of the new billionaire behind tech’s hottest IPO.

 

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