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Upfront

What made news recently: Flipkart buys Myntra, CAD narrows, GDP below 5 per cent for second year in a row and more.
Print Edition: June 22, 2014
AirAsia Group CEO Tony Fernandes
AirAsia Group CEO Tony Fernandes

THE TWEET THAT WASN'T

"@Mittu Chandilya exciting plans for airasia Indian. Whatever Indigo tries to do to stop us it just makes us stronger and smarter. Well done"
With this tweet, one thought, AirAsia head Tony Fernandes was going to usher plainspeak into Indian corporate circles. But, says The Economic Times, the post was later taken off.

DEAL DALLYING

  • Tata Sons Chairman Cyrus Mistry
    Tata Communications, known as VSNL until Tata Group acquired it as part of the government's disinvestment process in 2002, sold its 67 per cent stake in South African company Neotel for $680 million. That is a lot of money, but what created the louder buzz was that the buyer happened to be a unit of Vodafone. Immediately, the rumours that the Cyrus Mistry-led Tata Group is looking to sell its telecom operations in India to Vodafone found a few more believers. But it won't be easy. Tata's telecom portfolio has two listed companies. In one of those - Tata Communications - the government still owns 26 per cent.

THE SNUB CONTINUES
  • The Supreme Court, on May 22, declined N. Srinivasan's plea to be reinstated as BCCI president for non-IPL affairs. Srinivasan had sought urgency in the case since, by the time the court heard the case next, which would be September, his term as BCCI president would be over.
BUZZ
  • Malala is shot in the head, tumbles, bounces back to win the peace Nobel. Booted out, Steve Jobs bounces back to become a corporate icon. Mahatma Gandhi is thrown out of a train, but bounces back to become Father of the Nation. Each bounces off a mattress, a Kurl-On mattress, as depicted in advertisements made by Ogilvy & Mather. "Crass," said some. "Offensive," cried others. The question is, is this the latest outbreak of scam ads? The last big one was the Ford Figo series made by JWT India, which went on to claim three heads in the agency, including that of creative head Bobby Pawar.

30 MINUTES OF FAME
  • Step aside Vinod Mehta. Another Lucknow boy - Qaiser Ali, aged 19, can claim that title with more credence - shot to fame by becoming the owner of the Twitter handle @PMOIndia on May 20. Alas, his pride and joy lasted all of half an hour, before it was claimed back. But you may not have heard the last of Ali. He runs his own social network with 15,000 users and plans to launch a dating app. Bigger things have started smaller.

NEWS DIGEST
  • Nripendra Mishra
    Prime Minister Narendra Modi's Principal Secretary, Nripendra Mishra, hogged the limelight when the new government resorted to its first ordinance, skirting a Telecom Regulatory Authority of India clause, to bring him into office. Like his master, Mishra is a hard taskmaster.
  • The economy grew 4.7 per cent in 2013/14, marking a second straight year of sub-5 per cent growth - the worst slowdown in more than a quarter of a century. The data was below an official estimate of 4.9 per cent annual growth and compared with 4.5 per cent in the last fiscal year.
  • However, in a breather to the new government, the current account deficit narrowed sharply to $32.4 billion, or 1.7 per cent of gross domestic product, in 2013/14 from a record high of $87.8 billion, or 4.7 per cent, the year before. A sharp fall in gold imports due to restrictions on overseas purchases and muted imports of capital goods helped shrink the current account deficit.
  • Online retailer Flipkart has acquired fashion portal Myntra, as it prepares to battle with the rapidly expanding India arm of the global e-commerce giant Amazon. And Flipkart, led by CEO Sachin Bansal, may not be done yet. The company raised $210 million from Russian investment firm DST Global, which has also invested in companies like Facebook, Twitter and Alibaba Group.
  • The new government will restructure the United Progressive Alliance's flagship programme Mahatma Gandhi National Rural Employment Guarantee Act by linking employment with development in rural areas and rigorously implementing the new land acquisition law, according to Minister for Rural Development Gopinath Munde.
  • General Motors will start exporting vehicles from its Talegaon plant near Pune in the second half of 2014. GM was one of the few global carmakers that was using its India plant only for the domestic market. GM India sales dropped eight per cent to 80,890 units in 2013/14 from 88,150 units the previous year.
  • Google has overtaken Apple as the world's top brand in terms of value, according to global market research agency Millward Brown. Google's brand value shot up 40 per cent in a year to $158.84 billion. The top 10 of the 100 slots were dominated by US companies.
  • Infosys lost another heavyweight when B.G. Srinivas, a board member, put in his papers. He is the third CEO-hopeful to quit after Chairman N.R. Narayana Murthy's return to the company - Ashok Vemuri and V. Balakrishnan being the other two. While Vemuri went on to lead iGate, Balakrishnan joined politics.
  • Naresh Goyal-promoted Jet Airways posted its biggest quarterly loss - Rs 2,153.57 crore - in the three months ended March 31, mainly because it has been offering discounts to passengers to fill planes. The airline also reported a seventh straight annual loss in 2013/14 as fuel prices and airport costs remained high. Meanwhile, the Jet board named Cramer Ball as the CEO. Ball was earlier CEO of Air Seychelles, where he led a major restructuring programme that returned the airline to profitability in 2012 and 2013.
  • William S. Pinckney, Chairman and CEO of Amway India, was arrested by the Andhra Pradesh Police in connection with a complaint against the direct-selling firm. This is the second time that he has been taken into custody. A year ago , the Kerala Police had arrested Pinckney and two company directors on charges of financial irregularities.
  • China has told its state-owned enterprises to sever links with American consulting firms after the United States charged five Chinese military officers with hacking US companies. China's action, which targets consultancies like McKinsey & Co. and The Boston Consulting Group, stems from fears that the firms are providing trade secrets to the US government.
  • What would have been the worlds largest ever drugs merger fell off the deal table. Pfizer has abandoned its attempt to buy AstraZeneca for nearly $118 billion after the latter refused an offer of 55 pounds a share.
  • The median pay package for a CEO rose above eight figures for the first time, but there is a catch - Berkshire Hathaway's Warren Buffett and Facebook's Mark Zuckerberg reported a slide in their salaries in 2013. Buffett's pay was $485,606, down 77 per cent. Zuckerberg's salary was $653,165, down 67 per cent. The vast majority of their wealth comes from their ownership stakes, not their salaries as CEOs.
  • India has emerged as a country with some of the highest number of unregistered businesses in the world. Indonesia has the maximum number of shadow businesses, says a study of 68 countries by Imperial College Business School in London.

 

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