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Reliance Industries and Facebook Pilot JioMart on WhatsApp

Professor of Financial Economics and Part-time Value Investor, Transfin.
Apr 28, 2020 2:25 AM 5 min read
Editorial

Reliance and Facebook pilot JioMart on WhatsApp. India may see second wave of COVID-19 outbreak in late July-August, warn scientists. India could play major role in COVID-19 vaccine development. 60% firms running at less than 25% capacity, says CII. RBI announces ₹50,000cr ($6.6bn) liquidity facility for mutual funds. 

 

 

VIRAL INTERVENTIONS

RBI announces ₹50,000cr ($6.6bn) liquidity facility for mutual funds. 

Monetary Intervention

Mutual fund investors have been on the edge of late with Franklin Templeton fund house halting withdrawals from six debt mutual fund mutual schemes with large exposures.

 

Now, to ease liquidity worries and pressures, the RBI today announced (here’s the press release) a special liquidity facility of ₹50,000cr ($6.6bn) for mutual funds. The Central Bank’s liquidity facility will provide funds to banks at lower rates so that they can extend loans to mutual funds. This facility will be effective from today till May 11th. [Livemint]

 

Here’s a Twitter thread of the key points of the RBI’s announcement today. [@TFinMedia]

 

Government considers ₹3Lcr ($39.6bn) plan to provide loans to small businesses. 

Fiscal Intervention

The Government, meanwhile, is reportedly considering a ₹3Lcr ($39.6bn) proposal to guarantee bank loans to small businesses as part of the plan to restart the economy. [Moneycontrol]

 

BAD BUSINESS

60% firms running at less than 25% capacity, says CII.

To the Best of My Abilities

As per a survey by the Confederation of Indian Industry (CII), 60% of firms are operating at less than a quarter of their full capacity, with just 10% managing plant utilisation at over 50%.

 

Even as the Government has allowed major chunks of industries to operate, businesses remain crippled by lack of inputs, funds, movement of workers and raw materials. [BS]

 

Udaan lays off at least 3,000 contract workers. 

We Will Have to Let You Go

Udaan, a B2B commerce online startup, has laid off about 10-15% of its contract staff, around 3,000-3,500 workers, as per reports in the wake of the pandemic, which has severely hit the company's revenue from non-essential categories including electronics and apparel. [ET Tech]

 

47% of startups and small businesses in India have less than one month of cash left with them.

Extra Crunch

According to a survey by community platform LocalCircles, which received around 13,970 responses from start-ups and small businesses located in over 90 districts across the country, about 47% of startups and small businesses in India have less than one month of cash left with them while many are out of funds already.

 

Nearly 74% of the startups are expecting to shut down or scale down their businesses over the next six months, according to the survey.

 

Click here for the full scoop. [BS]

 

RELIANCE

Reliance and Facebook pilot JioMart on WhatsApp. 

Jio Goes Grocery Shopping

Shortly after Reliance announced the signing of binding agreements with Facebook for an investment of ₹43,574cr ($5.7bn) into Jio Platforms, JioMart is testing an “ordering system” on WhatsApp.

 

Users in Navi Mumbai, Thane and Kalyan can now use JioMart’s WhatsApp  business account for grocery shopping. 

 

Here's how you can place an order with JioMart. [Yourstory]

 

"A Tall Order"

As per an intriguing Livemint report, despite the massive investment of $5.7bn by Facebook, RIL's plans of becoming net debt free by March 2021 could still be a tall order.

 

RIL reported a net debt of  ₹1.53tr ($20bn) at the end of December, which means a lot more is needed to bridge the gap in the next 12 months.

 

The challenge is that asset sales in the energy business are likely to be difficult to come by, and free cash flows could be lower than expected owing to the impact of the lockdown.

 

Hit link to read in full. [Livemint]

 

PREPARING FOR THE FUTURE

India may see second wave of COVID-19 outbreak in late July-August, warn scientists. 

The Good and the Ugly

As per scientists, trajectory of daily new COVID-19 cases in India has reached a plateau and eventually it will take a downward fall, maybe for some weeks or even months. However, India is likely to see a second wave in late July or August with a surge in the number of cases during the monsoon.

 

The timing of the peak will depend on how India is able to control social distancing and on the level of infection spreads after restrictions are relaxed, they said. [News18]

 

Global stocks rise as countries lift lockdowns, reopen economies.

Dancing in a Ray of Hope

Global stocks rose today as investors bet big on economies kick-starting as countries lift lockdowns and announce stimulus measures. [WSJ]

 

The Debt After Disease

Leaders around the globe refer to the ongoing pandemic as a war against the invisible enemy - a physical, psychological and financial war. But let's confine ourselves to the financial aspect here.

 

Public borrowing in the rich world is set to soar to levels last seen amid in 1945. As economies fall into ruins, governments are writing millions of cheques to households and firms in order to help them survive lockdowns. At the same time, with factories, shops and offices shut, tax revenues are collapsing.

 

As this Economist article rightly says, long after the COVID-19 wards have emptied, countries will be living with the consequences. [The Economist]

 

A CURE FOR COVID

India could play major role in COVID-19 vaccine development. 

The Race of Our Lives

The entire world is enveloped in a race to develop a COVID-19 vaccine, and India is bound to play a major role in the entire process as one of the largest producers of generic drugs and vaccines. It is home to several vaccine makers, including the world’s largest by number of doses produced and sold globally, Serum Institute of India. And half a dozen Indian firms are researching vaccines against the COVID-19 coronavirus. [BBC]

 

One for All, All for One

Once we have a vaccine in our hands, distributing it will be a challenge, given how there will be astronomical demand for it from all corners of the world. It will also be of utmost importance to see that the vaccines go to the most needy and not just those with the deepest pockets. Here’s a piece on the push to distribute vaccines fairly. [Guardian]

FIN.

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