Airtel Payments Bank has partnered with French biometric solutions provider IDEMIA and Nokia parent HMD Global to launch an offline system for facilitating digital rupee payments on feature phones. 

Digital rupee is simply a tokenised digital version of the Indian fiat currency and is issued by the Reserve Bank of India (RBI) as a central bank digital currency (CBDC).

In a statement, IDEMIA said the trio will work together to introduce an ‘advanced offline payment system’ over the course of the next few months. The new system will enable users to make payments via CBDCs without being connected to the internet or not having a smartphone. 

“This partnership will work towards further strengthening financial inclusion and digital payments, to make it possible to pay in digital currency even without having a smartphone or being connected to the internet, either temporarily or because of coverage limitations,” the statement said.

The product is currently in design phase and, as per the companies, is the first ‘industry attempt’ to facilitate the use of digital rupee on feature phones through an app interface. 

The new offering will leverage Airtel Payments Bank’s financial solution and IDEMIA’s CBDC stack to build the app, and will be available on Nokia feature phones. 

It will aim to fuel the adoption of CBDCs in the country, promote financial inclusion and address issues associated with facilitating digital transactions in areas with limited connectivity. The app will also enable the players to tap into the growing adoption of digital currencies in the country and acquire a first mover advantage in the arena. 

“… We are confident that once we move from the design phase and launch the solution commercially with all required approvals, it will play a pivotal role in advancing the accessibility of financial services and contribute to India’s transition towards a digitally inclusive economy,” said Prasad Routray, head of corporate business and alliances at Airtel Payments Bank.

Amit Kakatikar, senior vice president of payments solutions at IDEMIA, added that the alliance will provide ‘valuable insights and contributions’ to the evolution of offline retail CBDC systems.

The new system will also enable the trio to roll out the CBDC payments to a wide-range of population, or almost 40 Cr Indian feature phone users. 

The development comes at a time when CBDCs are witnessing rapid adoption in the country. On Wednesday, RBI Governor Shaktikanta Das said that CBDC retail pilot has so far onboarded 1.46 Mn users and 0.31 million merchants at the end of August. A separate news report noted that last month saw 10.83 Cr overall CBDC transactions totalling INR 24,000 Cr. 

It is pertinent to note that retail CBDCs are still in pilot mode and were launched by the central bank in December 2022. 

Earlier this week, the State Bank of India (SBI) also integrated UPI with its digital rupee app to streamline user experience and enhance adoption of the new technology. 

The latest announcement from Airtel Payments Bank also comes as RBI tinkers with a host of novel technologies to spur the adoption of digital payments beyond metros and Tier-I cities. Earlier today, the NPCI launched four new UPI products – Credit Line on UPI, Near Field Communication (NFC)-based offline payments offerings UPI LITE X and Tap & Pay and conversational payments products Hello! UPI and BillPay Connect.

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Reliance Industries Ltd’s (RIL’s) demerged arm Jio Financial Services Limited (JFSL) will be excluded from the NSE indices, including the benchmark Nifty 50, from September 7. 

“In accordance with the index methodology, as JIOFIN has not hit price band on two consecutive trading days on September 4, 2023 and September 5, 2023 at NSE, the index maintenance sub committee (equity) of NSE Indices has decided to exclude JIOFIN from various indices as listed hereunder effective from September 7, 2023,” said NSE in a statement. 

It added that the exclusion shall not be deferred further even if Jio Financial hits the price band on September 6.

Besides Nifty 50, the stock will be removed from Nifty 100, Nifty 200, Nifty 500, Nifty Energy, Nifty India Manufacturing and 13 other indices. RIL spun off Jio Financial as a separate entity in July this year, after which the latter became a publicly listed entity in late August. 

The company had a lacklustre start on the bourses, hitting the lower circuit for five straight sessions before gaining at the fag end of August. However, the stock has pared losses since then. 

Shares of Jio Financial continued their rise on Tuesday as well, gaining 0.73% to end the session at INR 255.30 on the NSE. The stock touched an intraday high of INR 259.7.

Meanwhile, as per Nuvama Alternative Research, Jio Financial’s delisting could reportedly see the sale of nearly 105 Mn shares worth $324 Mn by Nifty passive trackers. The research firm also said that NSE would emulate BSE’s 20% filter even as retail investors await NSE’s price band circular for the stock.

The development comes days after the BSE removed Jio Financial from its indices. However, MSCI and FTSE indices continue to retain Jio Financial without any impact on inflow or outflow.

Amid all this, Jio Financial appears all set to shake up the financial services industry. At the conglomerate’s 46th Annual General Meeting (AGM) last month, chairman Mukesh Ambani unveiled a blueprint of the company saying it will launch products in the payments and insurance segments, apart from its already announced foray into the asset management space. 

Jio Financial will also explore blockchain technology and the central bank digital currency (CBDC) to build new-age products. 

As per the company, Jio Financial became the world’s highest-capitalised financial services platform at the time of its inception before the delisting announcement. 

Be it testing a soundbox for payments or building products in the general insurance and health insurance spaces, Jio Financial has a plethora of offerings up its sleeves and this has sent alarm bells ringing across India’s burgeoning fintech ecosystem. The Reliance Group company will take on startups like Zerodha, Paytm Money, INDMoney and Groww, among others. 

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Reliance Industries Ltd’s telecom arm Jio is reportedly in talks to raise up to $2 Bn in offshore loans, with BNP Paribas acting as lead arranger, to fund its 5G network expansion in the country.

The telecom giant is likely to purchase 5G gear from Swedish telecom giant Ericsson and the loans would be used to fund this purchase, ET reported citing sources. 

Ericsson, in October last year, said its 5G Radio Access Network (RAN) products and solutions will be deployed for Jio’s 5G rollout in India.

BNP Paribas will provide $1.9 Bn-$2 Bn over a nine-month period, during which Akash Ambani-led Jio will pay back Ericsson, BNP and some other banks, the publication said citing a person familiar with the matter.

The report added that the fundraise is happening through a discounted process and the implicit interest rate will be arrived at over the nine-month period.

The development comes after Jio tied up with Swedish export credit agency EKN for a $2.2 Bn loan to finance the equipment and services for its 5G expansion. “The $2.2 Bn cover from EKN will likely reduce Jio’s overall 5G gear funding costs as global lenders and 5G equipment suppliers involved in such a large deal will be more comfortable,” another source was quoted as saying. 

As per reports, Jio has also signed a deal with Nokia worth $1.7 Bn to purchase 5G gear.

Jio is the largest telecom operator in the country, with a market share of 38.35% in the Indian wireless market as of June 30, 2023.

During Reliance’s 46th annual general meeting (AGM), CMD Mukesh Ambani said Jio has surpassed the 450 Mn subscribers mark.

Jio’s 5G rollout is in its advanced stages and the company aims to achieve the nationwide rollout by the end of 2023. The telco’s 5G services are already available in 96% of census towns, Mukesh Ambani said at the AGM last month.

“Today, nearly 85% of the total 5G cells operational in India are in Jio’s Network. At our current pace, we are adding one 5G cell to our network every 10 seconds,” he said, adding that 1 Mn 5G cells are expected to be operational in Jio’s network by December. 

Jio reported a consolidated net profit of INR 5,098 Cr in the Q1 FY24, up 12.5% year-on-year.

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Embattled streaming platform Disney+ Hotstar received another blow on August 31 with the Board of Control for Cricket in India’s (BCCI’s) announcement that Viacom18 has won the media rights for the Indian cricket team’s international home matches as well as the domestic matches of the cricket board till 2028. Viacom18 will telecast the matches on Sports18 TV channel while streaming them on its OTT platform JioCinema. Earlier, these rights were with Star India and Disney+ Hotstar, respectively. 

Already reeling under the pressure of dwindling subscribers and loss of IPL media rights, Disney+ Hotstar lost yet another prized possession to the Reliance-backed OTT platform with the BCCI’s announcement. 

Echoing the disquiet was the former director of product management for ads at Disney+ Hotstar, Anurag Verma, who tweeted, “I guess the end of an era, having worked at Hotstar and seen crazy DAUs and MAUs the action will shift to JioCinema. Disney, in any case, was non-committal about Star and Hotstar and probably looking for a buyer. This most likely will be the beginning of the end.”

The warning stood in stark contrast with Star’s legacy, which counts itself as the first TV channel to broadcast matches in vernacular language. It also leveraged this capability to bring cricket to the smartphones of Indians when the streaming boom arrived. 

However, Disney+ Hotstar seems to have hit turbulent waters as JioCinema keeps on poaching its key digital allures one by one. Viacom18 winning the media rights to telecast the Indian cricket team’s matches in India for a sum of INR 5,963 Cr has once again brought attention to the ongoing streaming war in the country, which JioCinema looks set to win. 

Inflicting A Thousand Cuts

While it was initially launched in 2016, JioCinema largely came bundled with a slew of other apps from the Jio universe and was exclusively limited to its users, offering aggregated content. 

Two years later, in 2018, Star Sports India won both digital and television media rights for BCCI matches for a sum of INR 6,138.1 Cr for the next five years. Then, JioCinema decided to bide its time and strike at the opportune moment. 

It finally got this opportunity in 2022. In the past year, Jio mounted a big offensive against Disney+ Hotstar, which began with acquiring the rights to broadcast the FIFA World Cup 2022 in the country. Hot on the heels, JioCinema struck a major blow to the Star-backed streaming giant after it poached the rights of the coveted Indian Premier League (IPL) tournament from the latter. 

JioCinema made its intentions about dominating the OTT space clear by streaming IPL 2023 for free for both Jio as well as non-Jio users. 

Earlier, Disney+ Hotstar banked on the love for cricket in India to fuel its paid subscriber growth, which stood at a record 61.3 Mn at the end of the quarter ended September 2022. This was the last quarter of subscriber addition for the streaming major. 

The loss of the IPL in the cricket-crazy country resulted in an exodus of subscribers from Disney+ Hotstar. Its paid user base dwindled to 40.4 Mn at the beginning of July 2023 – by the time the IPL ended.

After poaching cricket fans, JioCinema set its eyes on another key digital property of Disney+ Hotstar — the premium English content viewers. The conglomerate-backed streaming player then signed back-to-back content partnership deals with HBO and NBCUniversal Media (NBCU) to bring premium English films and TV shows to India.

As a result, Disney+ Hotstar users were left bewildered as popular shows such as Euphoria, Succession, House of the Dragon, Chernobyl, and The Last of Us suddenly moved to JioCinema. 

Then came the final blow. JioCinema finally rebranded itself as a full-fledged premium offering, rolling out a premium ad-free subscription plan for INR 999 per year, supporting up to 4K resolution on four devices. In contrast, Disney+ Hotstar sells its lowest plan at INR 899 a year, which includes ads and supports a max of 1080p resolution and two devices.

Barring the media rights for the International Cricket Council’s (ICC’s) global tournaments in India, Disney+ Hotstar just has Marvel films and TV shows in its kitty, which may not prove to be an attractive hook for users leaving the platform in droves. 

Something For Everyone: The JioCinema Mantra

Over the course of the next year (2024), JioCinema is reportedly expected to stream 16 men’s matches (10 test and 6 T20 international matches) while Disney+ Hotstar may broadcast anywhere between 11 to 14 matches. This provides JioCinema an effective ad opportunity and a potential influx of paid subscribers if it decides to paywall the matches. 

Meanwhile, JioCinema has also complemented its cricket offerings by acquiring media rights pertaining to various games, including the 2024 Paris Olympics, Diamond League, NBA, Global Chess League, and BWF World Championships. 

Alongside, JioCinema also has the might and experience to build the needed digital infrastructure, even though it has faced some glitches in the past. 

On the other hand, Disney+ Hotstar seems to be a bit directionless at the moment. As its parent company weighs selling off the streaming platform or a joint venture, Disney+ Hotstar is streaming Asia Cup 2023 for free. It will also stream the upcoming ICC Men’s Cricket World Cup for free on its mobile app to counter JioCinema. 

With few premium English shows up its sleeves, the streaming major could be looking to pitch Marvel shows and films to a wider audience. Alongside, with a huge library of local and vernacular content, Disney+ Hotstar could also be looking to attract eyeballs of ‘Bharat’ (rural India) which still favours ‘desi’ content. 

However, over 100 Indian films and TV shows lined up by JioCinema, which are produced at a cost of INR 2,000 Cr, may well play a spoilsport for Disney+ Hotstar. 

Stage Set For Disruption?

“Basically, Jio has started at the top of the pyramid by signing content partnerships with big American studios, enabling them to acquire premium users who do not mind paying for high-quality English content. From there, JioCinema could come to the bottom of the pyramid and may pump a couple more billion dollars to acquire platforms that cater to Bharat,” IPVerse founder and chief executive officer (CEO) Pallav Bajjuri said on the Reliance-backed platform’s strategy.    

He, however, said that the space will eventually head towards consolidation, where bigger players would pick up smaller platforms. 

Going forward, Bajjuri said the next wave of innovation in the space could come from the streaming of gaming, vernacular content focused at Bharat and higher focus on reality shows. He believes that niche alone won’t be enough for sustenance, and content diversification and innovation would be the key to lead the market going forward. 

JioCinema seems to have understood this. The streaming platform has partnered with South Korean gaming giant KRAFTON India to broadcast the official Battlegrounds Mobile India Series (BGIS) in India, setting its eyes on the niche streaming space.

On top of that, its broadcast of IPL 2023 garnered more than 449 Mn viewers, while the streaming platform recorded ‘record’ revenues during the broadcast of IPL earlier this year. The final of the tournament clocked 32 Mn viewers, and it recorded more than 15,000 Mn video views in the first seven weeks of IPL.

With such impressive numbers and an ever-expanding content library, experts believe that JioCinema is well poised to disrupt the Indian OTT market, which is expected to grow to a size of $12.5 Bn by 2030, in the same way as Reliance’s telecom arm Jio. 

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A Mumbai Court has reportedly denied the anticipatory bail plea by 4B Networks’ cofounder Rahul Yadav after Interspace Communications’ country head Vikas Nowal filed a complaint with the Economic Offences Wing (EOW) over non-payment of dues to the tune of INR 10 Cr.  

As per Moneycontrol, a city sessions court bench rejected the plea on Wednesday (August 30), two days after Yadav moved the bail application. 

4B Networks’ cofounder Rahul Yadav and founding member Sanjay Saini had sought relief in connection with an FIR filed against them under various sections of the IPC, pertaining to fraud, cheating and criminal breach of trust.

The matter harks back to February 2022 when 4B Networks empanelled an advertising agency, Interspace Communications, for an outdoor media campaign. As per the FIR, Interspace claims that the company owes INR 10 Cr for installing 83 ad hoardings in Pune from April to August 2022.

In July, Inc42 exclusively reported that Interspace was one of the many vendors that the beleaguered startup had yet to pay. 

Nowal first knocked on the doors of the National Company Law Tribunal (NCLT) and then approached the EOW to file an FIR in the matter. 

4B Networks has been surrounded by multiple legal tangles, including an arbitration case involving its investor Info Edge. After pumping in INR 288 Cr in the Rahul Yadav-led startup, Info Edge wrote off the entire investment, including INR 12 Cr in debt, as allegations of financial allegation surfaced. 

Subsequently, the investor initiated a forensic audit of the startup. As per Info Edge, Yadav refused to cooperate and disclose financial transactions, forcing the investor to approach the Delhi High Court. The case is now in arbitration. 

The Delhi HC has barred Yadav, along with another party to the shareholders’ agreement of 4B Networks, Pratik Choudhary, to not sell, transfer or alienate any assets or properties of 4B Networks and to preserve all records and information.

Making matters worse for 4B Networks has been its separate arbitration proceedings with coworking space provider Innov8 over unpaid dues to the tune of INR 1.08 Cr.

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In the middle of a flurry of cases, troubled 4B Networks’ cofounder Rahul Yadav and founding member Sanjay Saini have now approached a Mumbai Court seeking anticipatory bail.

As per CNBC-TV18, the duo have sought bail in connection with a first information report (FIR) filed by Vikas Nowal, country head and cofounder of Interspace Communications, against Yadav for alleged fraud and cheating with the Economic Offences Wing (EOW).

The Mumbai police plans to oppose this anticipatory bail application, according to the report.

The duo is being questioned by the agency for the past few days. During interrogation, both Yadav and Saini insistently told the agency sleuths that they would pay the money owed to Interspace, although they refrained from giving a reason for the initial default.

Earlier this month, Nowal filed an FIR with the EOW under sections 406, 409, 420, 34 of the Indian Penal Code, alleging criminal breach of trust and fraud amounting to INR 10 Cr. At the centre of the dispute is the advertising agency Interspace Communications which Broker Network empaneled to undertake outdoor ad campaigns in February 2022. 

According to the FIR, Interspace installed 83 ad hoardings in Pune from April to August 2022. Nowal has alleged that Broker Network has defrauded Interspace and is yet to make the INR 10 Cr payment for the ad activity undertaken in 2022.

Inc42 first broke the story back in June this year, which delved into how Interspace was one of the many vendors that the troubled startup has not paid. 

The development came around the same time as the Delhi High Court,  while hearing an arbitration case filed by coworking space provider Innov8, noted that 4B Networks had forfeited its right to file a response in the matter. This forfeiture occurred because the startup failed to file a response despite being given a “last opportunity” to do so for not paying rent amounting to INR 1.08 Cr to Innov8.

Added to that, Broker Network is embroiled in another arbitration proceeding with its investor InfoEdge. After investing INR 288 Cr in the Rahul Yadav-led startup, the investor had to write down the investment due to allegations of financial misconduct.

Yadav refused to disclose financial transactions and related-party activities details during a forensic audit initiated by Info Edge, which led to full-blown arbitration proceedings. 

The investor has also approached the Delhi High Court against Yadav and Pratik Choudhary, who was also a party to the shareholders’ agreement of 4B Networks. According to Info Edge, the HC has directed Yadav and Choudhary to not sell, transfer or alienate any assets or properties of 4B Networks and to preserve all records and information.

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As expected, Reliance (RIL) chairman Mukesh Ambani outlined the grand plan for Jio Financial Services at the conglomerate’s 46th annual general meeting. From payments to insurance to investment tech, JFS is set to disrupt several key fintech segments and pose a significant threat to existing players — both startups as well as legacy BFSI companies.

Jio Financial Services was demerged from RIL in July and became a publicly listed entity in late August. However, it has not had the best of starts as a public company, hitting the lower circuit for five straight sessions before gaining at the end of last week (August 25, 2023).

Interestingly, hours before the AGM, JFS stock saw a brief rally, but the stock fell below its opening price at the end of the trading on Monday (August 28, 2023). Currently, JFS shares are trading at INR 211.65 apiece, with the company’s market cap settling at INR 1.34 Lakh Cr.

Despite the initial hiccups on the stock market, Ambani claimed that JFS has become the world’s highest capitalised financial services platform at inception, and called this financial safety net as one of the key potential success factors for JFS.

All this makes ominous reading for India’s fintech startups, which have so far banked on Reliance Jio’s internet services as a growth ladder. But now, startups not only have to solve the revenue puzzle that has plagued fintech for long, but also compete with a giant such as JFS, backed by Reliance’s technological prowess, retail network and significant reach in the Indian market.

Jio boasts of over 439 Mn subscribers, while Reliance Retail has close to 250 Mn registered customers and 3 Mn merchants, according to the company’s FY23 annual report. These will be the anchors for scaling up Jio Financial Services over the next few quarters.

We know that JFS has already had an impact on the competition, even without any depth of operations right now. Soon after the public listing, shares of fintech giant Paytm saw a dip despite gaining for several weeks.

BFSI is a highly competitive space for retail investors and as such the entry of JFS is likely to eat into the potential investments in the likes of Paytm, Policybazaar (PB Fintech), Fino Payments Bank and others.

For fintech startups, the next few months will involve plenty of rethinking and many of them are likely to push on with product plans that have been sitting idle. Given that JFS will most likely lean on the twin pillars of Reliance Retail and Jio for growth and scale, fintech startups have their work cut out.

JFS Takes On Zerodha & Co

Reliance’s plans in the asset management space have received the most clarity in the early days of Jio Financial Services.

The company has signed a joint venture with the world’s largest asset manager BlackRock to take a bet on India’s $540 Bn mutual fund industry, dominated by the likes of SBI, ICICI, and HDFC.

BlackRock CEO Larry Fink was on hand at the AGM to talk about how Jio-BlackRock is poised to disrupt the AMC space. Fink pointed out that BlackRock has built extensive capabilities in the Indian market and the JV with Jio will unlock several more investment opportunities for millions of Indians.

Jio-BlackRock is also expected to pose a significant threat to startups such as Zerodha, Paytm Money, INDMoney and Groww in the investment tech space.

Indeed many of these startups do not have an AMC licence (Zerodha, Groww being exceptions) and therefore are restricted to earning commissions as brokerages rather than a bigger chunk of the revenue from investments in mutual funds. AMCs typically charge a management fee based on the asset percentage, while brokerages generally charge per trade or offer flat-fee accounts.

Will Jio Finally Crack Payments Game? 

Besides the investment tech space, Ambani also pointed out that Jio Financial Services would be offering payments services for consumers and merchants, and also claimed that Jio would deploy blockchain solutions to make payments more secure and would also foray into services built around Central Bank Digital Currency (CBDC).

“In payments, JFS will consolidate its payment infrastructure, with a ubiquitous offering for both consumers and merchants further driving digital adoption for India. JFS products will not just compete with current industry benchmarks, but also explore path breaking features such as blockchain-based platforms and CBDC,” the chairman said.

While Ambani did not reveal much more about the payments business under JFS, we know that this will centre around Jio UPI and Jio Payments Bank, along with payments aggregator and payments gateway services.

Reliance is also reportedly testing a soundbox payment system which will be central to its plans to compete with payments apps. JFS’ payments business will directly take on a host of fintech companies in India — from PhonePe and Paytm to Google Pay and Amazon Pay, as well as the likes of CRED, WhatsApp Pay and others.

Despite launching UPI services in 2020, Jio has not made much dent in the market share so far. Jio’s app and the payments bank processed 1.34 Mn transactions in July 2023, with a total value of INR 114.12 Cr. Currently, Jio’s UPI services are available through the MyJio app as well as Jio Payments Bank portals. The company is likely to launch a dedicated app to push its payments services wider.

Jio’s payments volume pale in comparison to the likes of PhonePe, Google Pay and Paytm, the three largest UPI apps. For context, PhonePe processed 4743.66 Mn transactions in July 2023, with a total volume of over INR 7.6 Lakh Cr. So Jio has a long way to go before it can directly take on these UPI apps.

With 249 Mn+ Reliance Retail consumers, the JFS payment layer will allow Reliance to scale up rapidly and gives the company a goldmine of data to build features and allied services.

A Major Threat For Insurtech Players

On the insurance side, as speculated, Jio FInancial Services will launch products in the general insurance, health insurance, and life insurance space, partnering with global players, Ambani claimed. Ambani emphasised that the insurance platform will be digital in nature, but did not reveal much more about what consumers or businesses can expect.

As per recent reports, JFS is also planning to offer full-fledged insurance services starting 2024. Jio Financial is readying plans to approach the Insurance Regulatory and Development Authority of India (IRDAI) to apply for a licence.

The conglomerate has reportedly set aside a capital of INR 1,000 Cr for each of these insurance segments. Apart from traditional players such as Life Insurance Corporation of India (LIC), HDFC, ICICI Group and a host of other bank-led insurance plays, Jio Financial Services would also be rivalling digital-first insurance startups such as IPO-bound Go Digit, Acko, InsuranceDekho, and Navi Insurance, as well as aggregators (Policybazaar et al).

As per a report, the life insurance penetration in the country stood at a mere nearly 3% while non-life insurance penetration was much lower at 1% in financial year 2021-22 (FY22). The under-penetration of insurance offers an attractive proposition for Jio Financial Services, which could leverage Jio’s digital infrastructure, Reliance Retail’s business and partner network as well as Reliance’s healthcare plays to dominate the segment.

JFS To Eat Fintech Lending Pie?

The fintech sector is already besieged with high competition and low revenue potential in the payments segment and almost all players are only seeing revenue traction from lending operations.

Consumer durable lending, merchant lending, buy-now-pay-later (BNPL) are likely to be the key focus areas for JFS at the outset, according to a Bank Of America report. Consumer durable lending could be the initial focus for the company, as it has a captive user base that is availing credit for buying from Reliance Retail’s electronics store chain Reliance Digital.

On the other hand, BofA also stated that Jio Financial Services is likely to take time to scale up its lending play and doesn’t have the cheapest access to capital. However, the opportunity is undeniable. Beyond the top 10% merchants, not many are well-serviced by banks, digital lenders or traditional companies, which opens up a major opportunity for Jio Financial Services.

“We think there is a huge opportunity in wholesale lending to retailers/vendors, etc., as it is working capital heavy and many of these companies are cash flow constrained,” BofA said in its note in July about Jio Financial Services.

Will Jio Financial Services Go The M&A Route?

In the past, we have seen Reliance look to dominate new verticals with a mix of capital-led growth and inorganic acquisitions. The acquisitions of Urban Ladder, MilkBasket, Zivame, JustDial, NetMeds and other startups allowed Reliance Retail to grow rapidly in various verticals.

With the exception of some unicorns and listed giants, many startups are struggling with revenue growth and JFS could use its deep pockets to acquire some of these ailing startups.  Startups have faced regulatory headwinds, a funding winter (save for the likes of PhonePe) and Reliance’s mega entry will only deepen the wounds of the sector. Of course, these are still early days for JFS, but the threat to fintech startups cannot be understated.

The post Decoding Jio Financial Services: How Reliance Can Shake Up India’s Fintech Landscape appeared first on Inc42 Media.

Reliance Industries Ltd’s (RIL’s) financial services subsidiary Jio Financial Services (JFS) will explore new-age technologies such as blockchain-based platforms and Central Bank Digital Currency (CBDC) for its products.

Speaking about the newly-listed subsidiary during RIL’s annual general meeting, chairman and managing director Mukesh Ambani said, “In payments, JFS will ensure ubiquitous offering for both consumers and merchants, further driving digital adoption. JFS products will explore path-breaking features such as # blockchain-based platforms and CBDC.”

Ambani said that the newly listed company will increase the penetration of financial services with a digital-first approach that simplifies products, reduces cost, and expands reach.

“For tens of thousands of SMEs, merchants, and self-employed entrepreneurs, ease of doing business must mean ease in borrowing, investments, and payment solutions. JFS plans to democratise financial services for 1.42 Bn Indians, giving them access to simple, affordable, innovative, and intuitive products and services,” the RIL CMD said.

Last year, RIL announced the demerger of its financial services business and the spin-off of Reliance Strategic Investments as Jio Financial Services. JFS listed on the bourses earlier this month.

It has already tied up with investment giant BlackRock to foray into the Indian asset management space. The two companies will own a 50% stake each in the newly formed digital-first entity, Jio BlackRock.

“BlackRock is the world’s largest asset management company, managing assets worth over $11 Tn with a stellar reputation and track record. The JV will synergise the respective strengths of JFS and BlackRock to deliver tech-enabled, affordable and innovative investment solution,” Ambani said.

JFS will have products in the payments and insurance segments in India besides being in the asset management business, Ambani added.

Shares of JFS ended Monday’s session 0.28% lower at INR 211.65 on the BSE.

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Reliance’s newest entity Jio Financial Services (JFS) will have products in the payments and insurance segments in India besides being in the asset management business, Reliance chairman Mukesh Ambani said during the 46th annual general meeting (AGM) of the company on Monday (August 28).

“In payments, JFS will consolidate its payment infrastructure with a ubiquitous offering for both consumers and merchants, further driving digital adoption,” said Ambani, adding that JFS products will not only compete with current industry benchmarks but also new-age features such as blockchain-based platforms and the central bank digital currency (CBDC).

Further, as speculated, JFS is set to enter the insurance market in India, offering general insurance, health insurance, and life insurance products. JFS is partnering with global players to deliver insurance products digitally. 

As per recent report, the company is also planning to offer full-fledged insurance services starting 2024. 

Ambani said today that financial services is a highly capital-intensive business and Reliance has capitalised JFS with a net worth of INR 1.20 Cr. In fact, Ambani claimed that JFS has become the world’s highest capitalised financial services platform at inception, which also sets the path for the company to achieve “tremendous” success. 

“I have three reasons to be absolutely confident about JFS achieving tremendous success over the next few years. First, the digital-first architecture of JFS, will give it an unmatched head start to reach millions of Indians. Second, this is a highly capital-intensive business. Your company has provided JFS with a strong capital foundation to build a best-in-class trusted financial services enterprise and achieve rapid growth,” he said.

Besides, the company’s strong board led by KV Kamath would also help the company achieve greater heights, Ambani added.

JFS was demerged from RIL in July and listed at a slight discount earlier this month. With the deep-pocketed player set to enter the market of insurance and payments, competition for the new-age Indian players including Zerodha, Groww, Paytm, PhonePe, and PB Fintech increases considerably.

JFS has also tied up with the world’s largest asset manager BlackRock to take a bet on India’s $540 Bn mutual fund industry dominated by the likes of SBI, ICICI, and HDFC along with startups such as Zerodha, and Groww.

Following the announcements at the AGM, JFS shares ended Monday’s session marginally down at INR 211.65 on the BSE while RIL closed the session down 1.1% at 2442.55 on the exchange.

The post Jio Financial Services Set To Disrupt Insurance, Payments, And Asset Management Businesses In India appeared first on Inc42 Media.

Calling the launch of JioMart on WhatsApp a huge success, Reliance Retail executive director Isha Ambani said the ecommerce vertical has seen a 9X rise in customers since its launch on the Meta-owned messaging app.

“The launch of JioMart on WhatsApp has been a phenomenal success with 9X growth of JioMart customers on WhatsApp since launch in 2022,” Ambani said while addressing the shareholders at Reliance Industries Ltd’s (RIL’s) annual general meeting.

Last year, Reliance took its partnership with WhatsApp a notch higher to provide an end-to-end shopping experience for JioMart customers under which they can browse through JioMart’s entire grocery catalogue, add items to cart, and make the payment on WhatsApp itself.

Overall, the sales of digital and new commerce businesses surged in the financial year 2022-23 (FY23), reaching INR 50,000 Cr.

“Our digital and new commerce sales contributed ~ INR 50,000 cr, accounting for a fifth of revenues. We have invested over $10 Bn in the last two years, focusing on integration, growing in-house brands, and improving supply chain,” Ambani said.

She attributed the growth of the new commerce business to its omnichannel capabilities.

The company has built retail business on principle of ‘4 Cs’ – collaboration, consumer engagement, creativity, and care, Ambani said, adding that Reliance Retail has partnered with 30 lakh merchants to serve 98% of India’s PIN codes.

Reliance Retail owns brands such as JioMart, AJIO, Netmeds, and Trends, among others. Its consumer-facing retail businesses sell items ranging from footwear to electronics and from apparel to grocery.

In its grocery business, Reliance Retail sold over 18 Lakh metric tonnes of groceries during the year. It sold nearly 5 Lakh laptops and over 23 Lakh appliances and 50 Cr garments in the year.

“AJIO had yet another strong year, with its catalogue size crossing 13 lakh options,” Ambani added.

Reliance Retail’s net profit surged 18.8% year-on-year (YoY) to INR 2,448 Cr in Q1 FY24, compared to INR 2,061 Cr a year ago. Revenue from operations zoomed 20.5% YoY to INR 62,159 Cr in Q1 FY24 as against INR 51,582 Cr in Q1 FY23.

Qatar Investment Authority recently invested $1 Bn in Reliance Retail for an 1% equity stake, at a pre-money equity value of INR 8,28,000 Cr.

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Reliance Jio has introduced the Jio True 5G Developer Platform and Jio 5G Lab, enabling startups and enterprises to develop 5G use cases on Jio’s 5G network, edge computing and partner solutions.

“It will allow companies to activate network slices on demand, deploy applications on Jio’s multi-access edge compute locations and access a diverse ecosystem of partner applications on the platform,” said Akash Ambani, chairman of Reliance Jio, at the 46th Reliance Annual General Meeting (AGM).

The platform will also enable quick deployment of 5G edge compute solutions, enabling fast, autonomous decisions, immersive experiences and real-time edge AI, added Ambani.

Put simply, network slicing is making ‘slices’ of a 5G network to deploy certain use cases without the interference of other use cases. A 5G network can have any number of ‘slices’ to separate various applications. For instance, a network can have a separate ‘slice’ for low-latency applications such as streaming videos or playing online games, where user experience is paramount.

Enterprises can access advanced network slicing capabilities, which would enable them to independently establish and optimise network slices consistently. This should theoretically improve the network resource management for enterprises offering cloud-based solutions. 

The platform also offers access to partner solutions, allowing enterprises and startups to deliver 5G use cases.

Network slicing also offers a high degree of security since no two slices interact with each other.

During the event, Ambani also announced the launch of Jio 5G Lab at Reliance Corporate Park in Navi Mumbai. The facility will enable partners and enterprise customers to develop, test and produce industry-specific solutions. 

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Speaking at the 46th edition of the Reliance Annual General Meeting, group chairman Mukesh Ambani said that the company’s broadband internet service, JioFiber, has crossed 10 Mn subscriptions in India.

Ambani also announced the launch of a fixed wireless broadband (FWB) offering, the Jio AirFiber, set to launch on September 19. “Jio AirFiber uses our pan-India 5G network and advanced wireless technologies to bypass the need for last-mile fibre,” said Ambani.

With AirFiber, the company is looking to increase the broadband expansion rate from 15,000 daily additions to 1,50,000, a 10X jump.

For the uninitiated, fixed wireless broadband has been touted as one of the key use cases of 5G networks ever since 5G development started in the mid-2010s. Fixed wireless broadband enables a broadband experience on 5G without the need for last-mile fibre connectivity, making use of the high speeds and bandwidth that come with 5G networks.

Jio’s FWA launch follows rival Airtel, which launched a similar service earlier this month.

Elsewhere, Reliance Jio continued its dominance in the mobile broadband market, having crossed 450 Mn subscribers, as per the company.

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Reliance Jio has introduced Jio Smart Home Services that will allow users to control home appliances seamlessly. 

Speaking at Reliance Industries Ltd’s (RIL’s) AGM, Jio Chairman Akash Ambani said that Jio Smart Home Services is poised to “redefine how we experience and manage our homes”. 

With Jio Smart Home Services, Reliance Jio will directly compete against tech giants such as Google, Apple, among others. 

Jio is also launching Jio AirFiber to provide broadband connectivity. RIL Chairman Mukesh Ambani, during his presentation, said that Jio AirFiber will be launched on September 19.

Speaking about Jio’s 5G services, the RIL chairman said that Jio has over 50 Mn 5G users and the 5G services are now available in 96% of the census towns. 

Jio posted a revenue of INR 1,19,791 Cr in FY23 and an EBITDA of INR 50,286 Cr.

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Telecom giant Reliance Jio has surpassed the 450 Mn subscribers mark, Reliance Industries Ltd (RIL) Chairman Mukesh Ambani said during the 46th annual general meeting (AGM) of the company on Monday (August 28).

“Jio’s overall customer base has now crossed the milestone of 450 Mn subscribers reflecting a year-on-year (YoY) revenue growth of over 20%,” Ambani said.

The per-user data consumption on Jio’s network has also surged with the average user now consuming over 25 GB every month, he informed the company’s stakeholders.

“This translates to a monthly data traffic of 1,100 Cr GB, representing a 45% YoY growth,” Ambani added.

Speaking on the 5G network deployment in the country, Ambani said Jio’s 5G services are already available in 96% of census towns and the company is on track to expand the 5G services across the country by December 2023.

From December this year, Jio would be able to promptly fulfill all the demands for Jio 5G broadband connection across India, he said.

“Today, nearly 85% of the total 5G cells operational in India are in Jio’s Network. At our current pace, we are adding one 5G cell to our network every 10 seconds,” said Ambani, adding that 1 Mn 5G cells are expected to be operational in Jio’s network by December.

It is pertinent to note riding the wave of digitalisation in the country and growing subscribers in the telecom vertical, Reliance Jio Infocomm reported a 12.5% YoY rise in its consolidated net profit to INR 5,098 Cr in the Q1 FY24.

At the end of June 2023, Reliance Jio’s total subscriber base stood at 448.5 Mn as against 419.9 Mn a year ago. In that, the telco saw a net subscriber addition of 9.2 Mn in Q1.

The company also introduced the True 5G Developer Platform and Jio 5G Lab today during RIL’s AGM. It will enable startups and enterprises to develop 5G use cases on Jio’s 5G network, edge computing, and partner solutions.

Today, Ambani also informed that RIL’s broadband internet service JioFiber has crossed 10 Mn subscriptions in India while announcing the launch of a fixed wireless broadband (FWB) offering,  Jio AirFiber, on September 19.

Meanwhile, Jio has also unveiled Jio Smart Home Services today, which will be based on JioFiber and Jio AirFiber. It aims to improve home appliance control.

Following the AGM, shares of RIL closed today’s trading session 1.1% lower at INR 2,442.55 on the BSE.

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Amid the B20 Summit India 2023, a G20 dialogue forum for the global business community, Microsoft vice chair & president Brad Smith penned a note demonstrating India’s position in the global artificial intelligence (AI) ecosystem. 

In his post, which is the foreword for Microsoft’s report ‘Governing AI: A Blueprint for India’, Smith stated that India is ‘well positioned to help advance a global discussion on AI issues’. According to him, many countries will look to India for a global discussion on subjects related to AI. 

Smith, who is on a visit to India for the G20 Summit, is of the view that India’s efforts to advance the Indo-Pacific Economic Framework mark the country’s potential to lead major economies and drive support for responsible AI development and deployment within the Global South. 

According to Smith, for international-level of AI governance, nations need a multilateral framework that connects various national rules and ensures a certified and safe AI system. He added that working towards a planned internationally interoperable approach to responsible AI is critical for maximising the benefits of AI globally. 

“Recognising that AI governance is a journey, not a destination, we look forward to supporting these efforts in the months and years to come,” Smith wrote. He stated that the world is optimistic about the innovative solutions from India. 

Smith has penned down his perception of India’s AI governance at a time when the Indian government has already announced that it is planning to regulate the uses of AI to protect digital citizens from any cyber harm. 

In July, Minister of State for Electronics and Information Technology Rajeev Chandrasekhar announced, “We will regulate AI as we will regulate Web3 or any emerging technologies to ensure that these technologies don’t harm digital nagriks.”

Many global tech leaders, too, seem to be looking at India, which is an emerging leader in the global tech market. Earlier, OpenAI’s CEO Sam Altman made a similar note after his meeting with Prime Minister Narendra Modi on the need to regulate AI usage globally and the opportunities that India can present in this process. 

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Jio Financial Services Limited (JFSL), which many have deemed as one of the potential competitors of fintech giant Paytm, made a lacklustre debut on bourses Monday (August 21). Its shares got listed at INR 265 on the BSE and INR 262 on the NSE, slightly above the discovery price of INR 261.85 apiece.

The shares of the financial services company, carved out of the Mukesh Ambani-led Reliance Industries Ltd (RIL), hit lower circuit on the BSE and ended the day at INR 251.75. 

However, shares of Paytm witnessed some weakness following the listing of JFSL and declined 3.5% to INR 830.05 during the intraday trading today.

It is also pertinent to note that despite the weak listing, JFSL is currently India’s second-largest NBFC after Bajaj Finance, with a total market cap of INR 1,59,943.93 Cr.

Meanwhile, Paytm’s current market cap stands at INR 53,149.79 Cr.

Post listing of JFSL, shares like Paytm and Bajaj Finance were highly watched due to the threat of competition, said Prashanth Tapse, research analyst, senior VP research at Mehta Equities.

Last year, after RIL announced the demerger of its financial services business and the spin-off of Reliance Strategic Investments as Jio Financial Services Ltd, brokerage Macquarie had said that given the company’s large balance sheet, Paytm and Bajaj Finance would be at high risk.

Several other brokerages also expressed a similar opinion and a possible heightened competitive environment for the fintech startups overall. JFSL will largely focus on merchant and customer lending.

Tapse said, “…Paytm is the largest financial product servicing the sector digitally by leveraging the technology-led business model and delivering healthy segmental growth. We expect Paytm would continue to deliver healthy growth going forward despite Jio digital plans.”

“We believe India is in the urge for systematic growth and this needs a stronger and larger financial market which would be served by many more players. The Indian market opportunity is so big and underserved that many more players will come in the next 3-4 years,” he added.

Paytm shares ended today’s session 2.5% lower at INR 837.9 on the BSE.

There have also been reports about JFSL entering the insurance sector. Reportedly, it also approached the Insurance Regulatory and Development Authority of India (IRDAI) for a licence. On the other hand, the company has signed a joint venture with investment giant BlackRock to enter the Indian asset management space. 

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Naukri.com’s parent Info Edge announced on Friday (August 18) that it will invest INR 10 Cr in its wholly owned subsidiary Zwayam Digital to meet the working capital needs of the company. 

Founded in 2015, Zwayam is an SaaS HRtech platform that offers sourcing and screening recruitment solutions. The platform was acquired by Info Edge in 2021. However, it operates as an independent entity.

In the last fiscal year, the platform had a turnover of INR 38.53 Cr, along with a net profit of INR 2.55 Cr, Info Edge (India) disclosed in its exchange filings. 

Info Edge witnessed a net profit of INR 147.4 Cr in the first quarter of the financial year 2023-24 (FY24). Info Edge had posted a net profit of INR 292.4 Cr in the year-ago quarter. 

The company owns some major brands in the digital space like naukri.com, jeevansathi.com, 99acres.com, and shiksha.com.

According to a study conducted by Allied Market Research, the HRtech industry is expected to become a $76.5 Bn opportunity by 2031. 

In April, SaaS startup BetterPlace acquired Malaysia-based recruitment and job placement startup TROOPERS to expand its footprint. Earlier this year, the startup acquired Indonesia-based blue-collar workforce fulfilment platform MyRobin for an undisclosed amount.

In addition, InCred Capital acquired a 20% stake in the HRtech startup TeamNest this year. The deal enabled TeamNest to expand its presence. Not just this, State Bank of India invested $5 Mn in HRtech major Darwinbox in march this year.  

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Bharti Airtel’s subsidiary Airtel Payments Bank clocked a record quarterly revenue of INR 400 Cr in the first quarter of the financial year 2023-24 (FY24), up 41% year-on-year (YoY), helped by a strong uptake of its digital offerings.

The company, without disclosing the amount, said that its profit surged 143% YoY during the quarter.

In FY23, Airtel Payments Bank’s net profit stood at INR 21.7 Cr on a revenue of INR 1,291 Cr.

“We have achieved a remarkable milestone in our growth journey this quarter. For the first time, our revenues have surged to INR 400 Cr. Our brand’s reliability and cutting-edge product offerings, combined with an unparalleled distribution network and advanced technology, have positioned us favourably to continue accelerating our expansion,” said Anubrata Biswas, MD and CEO of Airtel Payments Bank.

The company said its customer deposits grew to INR 1,922 Cr in Q1 FY24, fueled by an increasing addition of new users. 

The number of monthly transacting users stood at 55.4 Mn, while annualised gross merchandise value (GMV) stood at INR 2,38,100 Cr.

The payments bank said it saw a strong demand for its customised plans that allow savings bank account customers to get additional benefits like insurance on an annual basis by making an additional payment. 

Airtel Payments Bank claimed that it now processes over 7 Bn annualised transactions across its platforms. It also claimed that it is the largest micro cash player in the country, with over 3,000 corporate partners.

Earlier this year, there were reports of a merger between Airtel Payments Bank and Paytm Payments Bank. However, Bharti Airtel denied any such plans.

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Reliance-backed streaming giant JioCinema clocked more than 10 Cr unique viewers and 3,000 Cr minutes of watch time during the broadcast of Bigg Boss OTT Season 2. Overall, the eight-week-long season logged more than 245 Cr views.

In a statement, the company claimed that the web series has emerged as the country’s biggest and most streamed digital entertainment property, next only to the IPL.

As per the company, the season finale of the show on August 14 set new records for the most-streamed live entertainment event in India. The episode raked up 2.3 Cr viewers and 72 Lakh users at peak concurrency.

The platform engaged more than 5.5 Cr users via 24-hour live streaming and interactive features such as multi-camera feeds and live chats during the season. A significant chunk of the viewership emanated from states such as Maharashtra, UP, Uttarakhand, Bihar, Gujarat, West Bengal, and Madhya Pradesh.

Meanwhile, sponsors from FMCG to technology, including new-age tech startups such as Paytm and Lenskart, also lined up to advertise on the platform.

With this, Bigg Boss OTT Season 2 has emerged as the second-biggest digital property in JioCinema’s arsenal. The broadcast of the IPL 2023 final recorded more than 32 Mn viewers while clocking more than 15,000 Mn video views in the first seven weeks of the tournament. 

At a time when peers such as Disney+ Hotstar are struggling to retain subscribers, JioCinema has further bolstered its presence in the Indian streaming space. Just this week, JioCinema forayed into the esports live streaming space by announcing its partnership with Krafton India to broadcast the official Battlegrounds Mobile India Series (BGIS). 

While clocking hefty ad revenues from free streaming of IPL, JioCinema has also been aggressively pitching for its premium content service in exclusive partnership with Warner Bros. Discovery, and NBCUniversal in India. 

The conglomerate-backed streaming platform has also invested INR 2,000 Cr to produce as many as 100 movies and shows, which are expected to release in the next 18-24 months.

JioCinema competes with the likes of both global and local giants such as Disney+ Hotstar, Netflix, Amazon Prime Video, Zee5 and SonyLIV. The company operates in the larger Indian OTT streaming space, which is projected to grow to a market size of $12.5 Bn by 2030 from about $1.5 Bn at the end of 2021.

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Ahead of its upcoming annual general meeting (AGM), oil-to-telecom conglomerate Reliance has received Bureau of Indian Standards’ (BIS’) certification for two of its upcoming models. 

As per details seen by Inc42, the two certified models – JBV161W1 and JBV162W1 – have been listed on the BIS website under the brand name Jio. The stamp of approval was granted on Friday (August 11). 

The devices conform to ‘IS 13252 (Part 1):2010’ and ‘IS 16333 (Part 3):2022’ mandates which cover the local standards for cell phones.

There is no clarity on the specifications of the two models, and may also just be the same model but with different colour options. 

This comes amid widespread speculations that Jio is looking to launch a Jio 5G phone later this month. As per a report in the Livemint, the conglomerate will likely unveil the 5G phone at its upcoming AGM on August 28. 

According to a separate report in India Today, the new Jio phones will likely boast of 4GB of RAM and 32GB of internal storage and will be powered by Snapdragon 480 System-on-a-Chip (SoC).

This is largely in line with a recent listing on CPU benchmarking platform Geekbench, which noted the testing of a similar Jio Phone. The device in question had a Qualcomm Snapdragon 480 Plus processor and, as per Geekbench, potentially 4GB RAM. 

Meanwhile, other reports have claimed that the new Jio 5G phone could include a 6.5-inch HD+ and LCD display, a 5,000mAh battery, a 13-megapixel dual rear camera and an 8-megapixel front sensor. 

Prior to that, another Jio phone was reportedly tested on the benchmarking platform under model number Jio LS1654QB5, which came with Snapdragon 480-Plus SoC, an Adreno 619 GPU and 4GB of RAM.

While details are still scarce, Jio could be targeting the lower-price segment with the new offering. As per reports, the company may price the 5G phone under INR 10,000 with a custom Jio operating system (OS) built on top of Android. 

Reliance Jio has made no qualms about its smartphone ambitions. With 5G rollout in full pace, the 5G smartphone launch could help the company further expand the next-generation service to users in non-metros and other parts of the country. 

The development comes close on the heels of Reliance recently launching the Jio Bharat 4G feature phone for INR 999. With a slew of new smartphone offerings, Jio is looking to cash-in on the growing adoption of phones in the country. With much expected to unfold over the coming days, it remains to be seen what the exact specifications of the new phones and which segment they target. 

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Mincing no words, Info Edge cofounder and veteran investor Sanjeev Bikhchandani on Friday (August 11) reportedly said that investing in Rahul Yadav-led 4B Networks was a ‘mistake’.

“You can’t write off INR 288 Cr, it was a mistake,” Bikhchandani said during the company’s post-earnings call as per The Economic Times.

He also said that the Info Edge’s board was mulling steps to tighten its due diligence practices and mitigate risks associated with portfolio companies. The company’s board was also said to be looking at identifying indicators and ‘red flags’ that may emerge at preliminary stages during talks with founders.

At the heart of the matter is Info Edge’s decision to write off its equity investment in 4B Networks during the quarter ended December 2022. The investor then cited ‘excessive cash burn, prevailing liquidity issues and significant uncertainty towards funding options’ as the reasons for pulling the plug on the investment.

Since then, a lot has happened at Yadav’s startup, with Info Edge even initiating arbitration proceedings against 4B Networks for allegedly failing to provide crucial information about operations and management for a forensic audit.

Earlier in June, Inc42 exclusively reported about the slew of problems, ranging from corporate governance issues to unpaid dues of vendors and employees, at the brokerage startup.

At that time, Info Edge announced the appointment of Deloitte as the forensic auditor to look into the financial details of 4B Networks. However, the management of 4B Networks allegedly didn’t cooperate with the auditor, following which the consumer internet company dragged Yadav to the Delhi High Court.

In a regulatory filing late last month, Info Edge said the HC (in July) directed Yadav and Pratik Choudhary, who was also a party to the shareholders’ agreement of 4B Networks, to ‘not sell, transfer, alienate, encumber or otherwise create any third-party rights or interest directly or indirectly in the assets and properties of 4B Networks’.

The investor said that the court also directed 4B Networks to preserve all books, records, accounts, databases, servers, any other devices, documentation or information.

Meanwhile, after two subdued quarters on account of write offs, Info Edge returned to the black in the first quarter (Q1) of the financial year 2023-24 (FY24). It posted a consolidated net profit of INR 147.4 Cr, while revenue from operations jumped to INR 625.9 Cr in Q1 FY24 from INR 547.3 Cr in the year-ago period.

Shares of Info Edge closed 4.12% lower at INR 4,458.90 on the BSE on Friday (August 11).

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Online classifieds major Info Edge turned profitable again in the first quarter of the financial year 2023-23 (FY24) with a consolidated net profit of INR 147.4 Cr. The company reported a consolidated net loss of INR 503.2 Cr in the previous March quarter due to it writing-off its investment in 4B Networks and Bijnis.

However, on a year-on-year (YoY) basis, Info Edge’s net profit declined from INR 292.4 Cr reported in Q1 FY23.

The company’s profit declined YoY despite a 14% rise in operating revenue to INR 625.9 Cr from INR 547.3 Cr in the corresponding quarter of last year. However, operating revenue saw a mere 3.5% rise sequentially from INR 604.8 Cr.

Info Edge, which operates real estate portal 99acres.com, online recruitment platform Naukri.com, matrimony portal Jeevansathi.com, and education platform Shiksha, witnessed a rise in sales across segments both on a YoY and sequential basis.

While Naukri.com clocked revenue of INR 462.1 Cr in Q1 FY24, up from INR 400.5 Cr in the last year’s quarter, 99acres.com saw its revenue rise to INR 82.7 Cr in the quarter from INR 66.3 Cr in Q1 FY23.

On the other hand, Jeevansathi.com and Shiksha together contributed INR 81.2 Cr to Info Edge’s total revenue in Q1 FY24 as against INR 80.4 Cr last year. These two segments’ cumulative loss before tax also declined to INR 53.8 Cr during the quarter under review from INR 102.8 Cr in Q1 FY23.

Info Edge’s recruitment platform Naukri.com saw a 16.3% YoY rise in profit before tax to INR 264.6 Cr in the quarter under review.

It is pertinent to note that in Q3 FY23, Info Edge’s net profit nosedived 99% YoY on the back of an exceptional loss of INR 412 Cr on account of the impairment of its entire investment in Rahul Yadav’s 4B Networks.

In the preceding quarter, Q4 FY23, the company also saw an exceptional loss of INR 97.5 Cr as it wrote-off its entire investment of INR 76.6 Cr in BizCrum Infotech – Bijnis.

The company didn’t report any exceptional losses during the quarter under review.

On the expenses front, Info Edge saw a rise in total expenses to INR 450.8 Cr in Q1 FY24 from INR 441 Cr reported in the preceding quarter. However, total expenses declined over 4% on a YoY basis.

Meanwhile, employee benefit expenses increased 1% YoY and almost 7% sequentially to INR 281.7 Cr In Q1 FY24. Advertising and promotional costs declined over 20% YoY and 16% sequentially to INR 85.6 during the quarter under review.

Shares of Info Edge slumped after its Q1 results, ending Friday’s session over 4% lower at INR 4,457.05 on the BSE

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Shares of the listed drone startup IdeaForge slipped 6% to INR 1,008.05 on the BSE in Wednesday’s intraday trade after the drone maker announced its first quarterly results since its stock market debut last month, the lowest since its market debut on July 7.

The stock has been on the decline for the past six trading sessions, falling 13% during the period. Currently, IdeaForge shares are trading at INR 1,015.70 apiece as of 01:42 PM on Wednesday (August 9). The market price of the company has corrected 25% from its record-high level of INR 1,344 touched on listing day.

However, the stock is still trading around 50% higher than its issue price of INR 672 per share, having listed at INR 1,300 on the BSE, a 94% premium over the issue price.

The share price failed to rally despite the drone startup announcing bagging an INR 88 Cr order from the Ministry of Defence for the supply of surveillance quadcopters with accessories.

The development comes after IdeaForge reported a 54% year-on-year (YoY) decline in its consolidated profit at INR 18.86 Cr for the April-June 2023 quarter (Q1 FY24) as against INR 41.25 Cr in the year-ago quarter (Q1FY23). The company had reported a loss of INR 5.42 Cr in the previous quarter (Q4FY23).

Revenue from operations was down 2.2% YoY to INR 97.07 Cr from INR 99.27 Cr. However, on a sequential basis, the company’s revenue from operations grew 151% from INR 38.66 Cr in Q4FY23 with an EBITDA margin of 3.1%.

“Given the nature and nascent stage of the drone industry in our country, our business performance is not immediately comparable on a quarterly basis,” Ankit Mehta, the CEO of ideaForge, said.

After the results were announced, the CEO said that IdeaForge has made ‘notable strides’ in its ability to innovate by introducing products engineered to serve a wide ambit of use cases.

“The launch of the new Netra V4 Pro UAV as well as initiating the development of UAV logistics platform are a testament to this fact. Aligning with the sectoral opportunities, we are actively pursuing new product development and business models,” said Mehta.

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Continuing its winning streak, Reliance Jio added wireless subscribers to its network for the third consecutive month, as per the data released by the Telecom Regulatory Authority of India (TRAI).

Jio added 3.04 Mn wireless subscribers during the month. Bharti Airtel, which had a poor showing in April with the addition of only 76,328 wireless users, added nearly 1.4 Mn subscribers in May. However, Jio continued to outpace the second-largest telecom company in the country.

Meanwhile, Vodafone Idea (Vi) and state-owned telcos, BSNL and MTNL, witnessed massive user churn. Vi continued its losing streak in May as the telco lost more than 2.8 Mn users. 

At the same time, BSNL and MTNL lost 1.5 Mn and 2,388 users, respectively. Together, the two government-owned telecom operators accounted for less than 10% of the Indian wireless user base in May 2023.

In terms of market share, Jio led the pack comfortably with a 38.17% share of the Indian wireless market. Airtel accounted for 32.57% of the wireless market, while Vi was a distant third with a 20.20% market share.

Overall, the net addition for wireless users stood at 73,811 in May as against a loss of 7.96 Lakh wireless users in the previous month. The country’s overall teledensity stood at 84.40%, a slight decline caused by urban teledensity falling to 133.34% from 133.64% in April.

The total number of broadband (including both wireless and wireline) users in India went up to 856.81 Mn at the end of May, 5.87 Mn higher than the 850.94 Mn recorded at the end of April.

Jio’s dominance becomes more pronounced when looking at the total number of broadband users, as the Akash Ambani-led telecom giant accounted for nearly 52% of the market share, or 445.23 Mn users as of May 30, 2023.

A total of 11.47 Mn requests were submitted for Mobile Number Portability (MNP) in April. 

Even as both Jio and Airtel are battling it out for supremacy in the telecom market, it seems the fighting has spilt into the satellite communications arena as well.

In its submissions to TRAI, the Akash Ambani-led telco has pitched for a spectrum auction, while Bharti Airtel-backed OneWeb has sought an administrative allocation.

Jio recently received a major boost as it secured $2.2 Bn funding from the Swedish Export Credit Agency to fund its 5G rollout, which is expected to give it an edge over Airtel and Vi.

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