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Reliance Industries Reports Lowered Growth, Netflix Adds 9m New Subscribers, Softbank to Buy over 40% Stake in FirstCry and 38% stake in Delhivery et al.

Professor of Financial Economics and Part-time Value Investor, Transfin.
Jan 18, 2019 2:41 PM 4 min read
Editorial

Reliance Industries reports lowered growth, Netflix adds 9 million new subscribers in the last three months of 2018, driven by growth in international markets. Softbank to buy over 40% stake in FirstCry and 38% stake in Delhivery.

 

Now to Today's Top Business News Stories in Our End Of Day Wrap Up:

 Reliance Industries Reports Lowered growth, Netflix Adds 9m New Subscribers, Softbank to Buy over 40% Stake in FirstCry and 38% stake in Delhivery et al.

RIL

Reliance Industries reports lowered growth. Reliance Retail and Reliance Jio to jointly launch new e-commerce platform.

 

Calm Margins: As per a Livemint report, Reliance Industries reported rather sluggish growth in Q3 with earnings before interest and tax (EbIT) rising 1% Q-0-Q, down from 1.9% in the previous quarter and 11.2% in the first quarter. Net profit stands at 8.8% Y-o-Y. Growth in telecom and retail rallies, while R&M takes a hit due to depressed GRM. Petrochemicals stable.

 

The Bigger Picture: As per analysts, the sluggish growth is worrisome because rising debt at telecom and retail is likely to leave consolidated net liabilities higher sequentially to INR3.2t.
 

Also This: Chairman and MD Mukesh Ambani today announced that Reliance Retail and Reliance Jio would jointly launch a new e-commerce platform which would first be rolled out in Gujarat.
 

From the Horse’s Mouth: View the financial results of Reliance Industries here

 

NETFLIX

Netflix adds 9 million new subscribers in the last three months of 2018, driven by growth in international markets.

New Subscribers: The video-streaming platform Netflix reported that it had added c. 9 million new subscribers (beating its own expectations of 7.6 million) during the last three months of 2018, a 34% rise from last year.

Up Close: The platform now has 139 million subscribers globally and expects to add another 8.9 million subscribers by March.

Who Drives the Growth: The growth in customer base is primarily credited to the growing number of international users. Netflix added 7.3 million international users in the fourth quarter, a 42% rise from a year earlier.

What Is Netflix Sacred Of?: The company in a letter to its shareholder’s said that it is not worried about Amazon or Disney, but of the newer forms of entertainment such as Fortnite and Youtube, focusing on the fact that it's about winning time, not content. 

Who’s the New Kid on the Block?: Read our LongShorts here to know more about Netflix’s new competitor – Fortnite.

Perspective: The news comes shortly after Netflix announced a raise in subscription price in the US.

 

STARTUP

Softbank to buy over 40% stake in FirstCry and 38% stake in Delhivery.

FirstCry: Softbank is set to invest $400m in BrainBees Solutions, which owns and operates FirstCry for a 40% stake in the online store for kids and baby products.
 

More on this: The fresh funding is expected to assist FirstCry strengthen its online as well as offline presence against competitors such as Amazon and Flipkart.
 

Delhivery: Softbank seeks to acquire 38% stake in logistics company Delhivery. The company is perhaps one of the most-funded of its lot. It has previously raised c. $250m from private equity firms Carlyle and Multiples Alternate Asset Management, Tiger Global, Fosun International, venture capital firm Nexus Venture Partners and Times Internet.
 

The Process: Softbank will make the acquisition through a Cayman Islands-based holding company called SVF Doorbell (Cayman) Ltd. It will buy 22.44% primary equity in the company and subsequently add more through buying stakes in Delhivery.

Reliance Industries Reports Lowered growth, Netflix Adds 9m New Subscribers, Softbank to Buy over 40% Stake in FirstCry and 38% stake in Delhivery et al.

BUDGET

Finance Minister hints at a farm relief package in Interim Budget 2019.
 

Farm Relief: Ahead of the Interim Budget 2019, Finance Minister Arun Jaitley hinted at a farm relief package for distressed farmers. However, he refused to give away any more details stating that the proposed plan is still a work in progress.
 

Ever wondered what an Interim Budget is, and how it is different from a Full-Year Budget?: Click link here for a quick summary.

 

CONSUMER

What will TRAI’s new tariff order mean for the consumers and the broadcasters?

 

New Framework: The telecom regulator has recently brought about a new framework on TV channel pricing and packaging under which consumers will be able to select and pay for TV channels on an individual selection or "a-la-carte" basis (vs. a lump-sum bundled offering).

Zoom In: As part of the new regulations:

  • DTH providers can charge subscribers a maximum of INR130 for a set of 100 channels
  • Customers can additionally select free-to-air or pay channels


Click here to see how TRAI’s new tariff order will affect your cable bill. Find answers to some frequently asked questions on the order here.

 

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