News digest: GST impact, HDFC MF, rostering scam, Neev realty fund and more

After Swiggy, five more start-ups are waiting to join billion-dollar club 

Swiggy made news last week as it became a unicorn (companies valued at over $1 billion), but at least five more are waiting to join the billion-dollar start-up club. In a shift from the current trend, many of the would-be unicorns do not belong to the pure-play e-commerce universe.

According to the data compiled from diverse sources, of the next five companies closest to breach the $1-billion valuation mark, three are business-to-business (B2B) firms — technology-enabled logistics player Rivigo, point-of-sale (PoS) service provider Pine Labs, and software as a service (SaaS) company Freshworks. This puts them on a par with online grocery retailer BigBasket and budget hotels network Oyo, which have been called the next-generation giants. READ MORE

HDFC Mutual Fund's perks to distributors make industry see red 

The Rs 23-trillion mutual fund (MF) industry is seeing red over equity share allotment made by the country’s most profitable fund house HDFC MF to the distributor community, which continues to remain a vital link between investors and asset management companies (AMCs).

Ahead of its much-awaited initial public offering (IPO) — only second by an AMC so far — HDFC MF, which manages assets worth over Rs 3 trillion, has made a private placement of shares worth Rs 1.5 billion to 140 distributors. While in its offer document filed with the Securities and Exchange Board of India, the asset manager has clearly made provisions for such an allotment, industry players see this as a distortive trade practice. READ MORE 

 

Watch time! Hotstar fights it out with YouTube 

It’s a battle for dominating the digital media and entertainment segments. On the one hand, with over 225 million viewers (according to App Annie) hooked to Google’s YouTube every month on mobile devices, it is numero uno in the over-the-top (OTT) digital space.

But taking it on is a traditional broadcaster, Star TV India’s Hotstar, which, in the past three years since its launch, has been able to garner an average over 

150 million viewers a month, hitting new highs when there is cricket, like during the recently-concluded Indian Premier League. READ MORE  

Air India orders probe into rostering scam 

Even as the government’s efforts to sell majority stake in Air India came a cropper, it has come to light that a section of Air India’s pilots, deputy general managers (DGMs), clerks and other officials has been making some easy money on the side by playing the system. Airbus and Dreamliner pilots’ flying hours and rosters are being nimbly manipulated, with the result that the loss-making national carrier is ending up paying these pilots a lot more than it needs to.

To encourage flying, Air India has an absurd rule in place that says that pilots will be paid for 70 hours of flying per month provided they do a minimum of 40 hours’ flying. Above 70 hours, there is overtime payment in three slabs  — 70-80 hours, 80-90 hours and 90-100 hours. Hence, even if a pilot flies 40 hours in a month, he gets paid for 70 hours. But if he does 39 hours, he gets paid for 39 hours. READ MORE 

Pai-backed Neev realty fund to shut down as tier-II developers struggle 

In a telling sign of challenges faced by second-rung real estate developers, former Infosys chief financial officer T V Mohandas Pai and Manipal Group scion Ranjan Pai, along with other investors, could wind down a real estate fund floated by them to invest in tier II developers, said a source in the know.

The fund called Neev was floated in 2016 and the partners were planning to raise Rs 2.50 billion initially for the fund. Of that the drawdown has been Rs 900 million so far, invested across three deals.

The original plan was to take the fund corpus to Rs 10 billion.

Apart from Mohandas and Ranjan, Salarpuria Sattva Managing Director (MD) Bijay Agarwal, Micro Labs Chairman Dilip Surana, Manipal Group advisor Abhay Jain, and Prashant Deshpande, son of Karnataka Revenue Minister R V Deshpande, are partners in the fund. READ MORE  

GST impact: Going gets rough for Surat's diamond, textile traders 

At 40, Ashish Sukharawala has become an insurance agent and is still learning the ropes. Until recently, he was a second generation weaver with 100 powerlooms in an industrial estate in Surat. However, the heavy tax burden under the new goods and services tax (GST) regime and the resultant losses in his business have forced Sukharawala to sell his looms for scrap and rent out his premises to a plastic trader.

Sukharawala’s story is being replicated across Surat’s textile and diamond industries. In the one year since the GST kicked in, many of the city’s powerloom owners have shut shop and small-time textile and diamond traders moved on to other businesses. The once busy Ring Road, which houses wholesale textile markets, has less traffic now. READ MORE