Telecom Competitiveness, Merger and Acquisitions, the new Idea for Vodafone to help their customers.

The following article is based on my own interpretation of the said events and/ or publicly available information. Any material borrowed from published and unpublished sources has been appropriately referenced. I will bear the sole responsibility for anything that is found to have been copied or misappropriated or misrepresented in the following post.

Abhishek Shringi, MBA 2016-18, Vinod Gupta School of Management, IIT Kharagpur


The market redesign of telecom market by the launch reliance jio has re-triggered the trend of mergers and acquisitions among tel-cos. The sector of telecommunication has seen several mergers in the past 4 years’ like MTS and Aircel merging in Reliance communications. But this merger talks between is Idea and Vodafone is about the fight to become no. 1 tel-cos in the country. It is about adding new customers and grow revenue market share(RMS), adding value to customer service by the high end experience of Vodafone and Idea’s distinct corporate ecosystem to drive the targeted synergies towards a healthier bottom-line. This merger will result in the country’s largest tel-co replacing Bharti Airtel.

Reliance Jio started its work by officially acquiring 95% of the shares of Himachal Futuristic Communications Ltd (HFCL) in 2012. But this plan started much before in 2010 when reliance industries on back hand with help of HFCL took PAN India license for 4G spectrum such that the other companies does not come to know and the spectrum could be purchased at much lower cost in 2010 spectrum auctions by TRAI. This blasting entry by Reliance industries in telecom sector in 2012 via Project Vijay, later changed to Reliance Infotel and then Reliance Jio created a bruising impact on the existing telecom companies in the market like Airtel, Vodafone, Idea, Tata Docomo, and BSNL. Specially the free voice and data service by Reliance Jio that was to be given till December 2016 and later extended till March 2017 has resulted in worse quarter for telecom companies disturbing their revenue model and decreasing their profits by as much as 60%.

To fight the current scenario Vodafone Group doesn’t have much of the choice but to accelerate its expansion moves in India- likely with the help of Idea Cellular. Although this acquisition will have several road blocks like Indus tower stake holding, regulatory hurdles associated with spectrum caps and significant market power in terms of combined customer base and RMS, but it can be dealt in a year time and by surrendering excess spectrum. Another major problem the existing tel-cos face against Jio is that they own license of only limited states across India like Idea have of only 11 circles, Vodafone in 14 circles, airtel in 16 circles only whereas Reliance Jio owns PAN India license across the country.

In a country like India whose telecommunication network is the second largest in the world by number of telephone users (both fixed and mobile phone) with 1.053 billion subscribers as on 31 August 2016 this process of competitiveness and mergers will not only create a big telecom giant in India but also will increase the competitiveness in the Indian telecom market in terms of providing quality service, technology and providing a competitive pricing to customer base in terms of adding value for them.  And this competition will further facilitate a faster growth of country in a new direction towards the new era of digital transformation. The path on which the journey of success has started and will go beyond the infinity.

Down-round for Snapdeal. What does it mean to other start-ups ?

The following article is based on my own interpretation of the said events and/ or publicly available information. Any material borrowed from published and unpublished sources has been appropriately referenced. I will bear the sole responsibility for anything that is found to have been copied or misappropriated or misrepresented in the following post.

Bharat Sabnani, MBA 2016-18, Vinod Gupta School of Management, IIT Kharagpur

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Snapdeal has had a poor last year with their losses increasing from Rs 1328 crore in 2014-15 to Rs 3316 crore in 2015-16. This in addition to the speculations from investors has resulted in down-round for Snapdeal. A down-round means a reduced valuation of the start-up compared to that of the previous round. This down-round can affect the investors sentiments and its founders but it can also reduce the short-term pressure that Snapdeal faces. The reduced valuation can actually lead to smart business practices and making the business sustainable.

Other emerging start-ups can also learn from this to focus on effective business models instead of short-run marketing gimmicks like deep discounts. The flow of money and investments are not infinite and the start-ups should keep this in mind. The aggressive funding will eventually come down and this will balance the current start-up ecosystem of India. This is just the start of down-round and all the start-ups should make it a point to make their businesses sustainable, so that they are not affected by the increase or decrease of their valuations.

ISRO tests C25 Cryogenic Engine

The following article is based on my own interpretation of the said events and/ or publicly available information. Any material borrowed from published and unpublished sources has been appropriately referenced. I will bear the sole responsibility for anything that is found to have been copied or misappropriated or misrepresented in the following post.

Ritvik Singh, MBA 2016-18, Vinod Gupta School of Management, IIT Kharagpur


Last week, on India’s Republic Day, Indian space agency ISRO gave the country its best gift by successfully testing its most powerful cryogenic engine, code-named C25. It was tested for a duration of 50 seconds at ISRO Propulsion Complex (IPRC) in Mahendragiri. This is the same technology which was used in Saturn V, which carried man to the moon in 1967. By testing an engine this powerful in the first attempt, ISRO has once again demonstrated its ability to work in new areas.

For those who are unfamiliar with this technology, Cryogenics is the study of substances at a temperature as low as 150 degree Celsius and lower. Since Cryogenic engines use liquid Oxygen and liquid Hydrogen as fuels at this temperature, they can be tricky to operate. Thus far, the US, Japan, China, France and Russia are the only countries to have tested Cryogenic engines.

In my opinion, this is a great news for India. Since Russia denied this technology to India under US pressure, it is a huge accomplishment for them to develop such a complex technology. With a powerful C25 backing the GSLV Mark III rocket, India is looking forward to launching its second moon mission – the Chandrayaan 2.

Idea-Vodafone Merger

The following article is based on my own interpretation of the said events and/ or publicly available information. Any material borrowed from published and unpublished sources has been appropriately referenced. I will bear the sole responsibility for anything that is found to have been copied or misappropriated or misrepresented in the following post.

  • Srishti Ranjan, MBA 2016-18, Vinod Gupta School of Management, IIT Kharagpur

 

While Reliance Jio’s entry in the Indian telecom sector proved quite a challenge for the big companies in this sector, a possible merger between Vodafone and Idea Cellular may change the telecom scenario altogether. Though the companies did not divulge much details, but both issued statements confirming that their businesses will be merged in a cashless deal. The basic premise of the merger is said to be based on equal rights between Aditya Birla Group and Vodafone in the combined entity.

The merger if materialized will not only knock off Bharti Airtel from its top position in the telecom sector but may also lead to altogether new pricing strategies in the industry. While the merger will mean some relief in financial aspect for Vodafone, Idea will benefit geographically especially in cities where Vodafone already has a good presence. It will enable them to provide a tough competition to Reliance Jio Infocomm and Bharti Airtel. Bharti Airtel currently has 33% market share with around 266 million users, which, if the merger occurs, will be countered by Vodafone-Idea combined user base of 390 million (roughly 43% of the market share). The decision is being taken when already the telecom sector is undergoing a huge price war reinvigorated by the cut throat prices introduced by Reliance Jio. It will be interesting to watch as to how the merger if finalized is practically implemented and what the combined Vodafone-Idea entity is named as.

Reference : http://economictimes.indiatimes.com/markets/stocks/news/vodafone-confirms-merger-talks-with-idea-cellular-5-key-takeaways/articleshow/56870115.cms

Volatile Democracy

The following article is based on my own interpretation of the said events and/ or publicly available information. Any material borrowed from published and unpublished sources has been appropriately referenced. I will bear the sole responsibility for anything that is found to have been copied or misappropriated or misrepresented in the following post.

Rishita Pramanik, MBA 2016-18, Vinod Gupta School of Management, IIT Kharagpur

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I fail to understand the world these days! At least the democracies. Few months back there was a quote “flaring” the online space. It said, “Countries are in a race to prove themselves idiots. Currently Britain has the lead but America has a  Trump card.” And by all means, it seems that people of USA have played this card.

I do not judge anyone, especially if it’s neither in my right, nor my interest to do so. It was in the right and interest of USA citizens and they gave a judgement which I totally respect. However why is it that these same people who gave their chosen one a marginal victory are now upset if he has disbarred certain people to enter USA albeit having valid VISAs. Surprisingly its similar to what the British did after the Brexit vote!

As per a report, poll found that 41% of American voters disagreed with the recent Muslim ban policy while another 10% were in a dilemma. Four US states are planning to sue the POTUS and there are already talks of his impeachment in the media. I do not intend to argue if this decision is for the good of America or otherwise. What I’m trying to say is that Mr. President had made his intentions crystal clear while he was the president elect nominee then why is the country shocked and surprised at what he has done. He has merely taken his first step towards fulfilling the promises which have made him sit where he currently sits.

And if the people really are feeling resent towards him now, then it’s a question mark on the face of democracy as a system. Election is the base on which democracy stands and if the people send their wit away to graze as they cast their vote, then, well…the Muslim ban seems like the least of all worries!

Why Trump is good

The following article is based on my own interpretation of the said events and/ or publicly available information. Any material borrowed from published and unpublished sources has been appropriately referenced. I will bear the sole responsibility for anything that is found to have been copied or misappropriated or misrepresented in the following post.

T R Srinath, MBA 2016-18, Vinod Gupta School of Management, IIT Kharagpur

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A new bill introduced by Democratic Congresswoman Zoe Lofgren proposing changes in the H-1B visa programme seeks to raise the minimum salary under the scheme to $1,30,000 from the current $60,000. The legislation, if passed, could hit Indian and American IT companies which use H-1B visas to hire foreign skilled workers, including Indians.

Even 8th standard social studies textbooks talk about the menace of brain drain. We’ve been taught that brain drain is bad and that the flight of skilled and educated Indians to foreign countries is something that causes harm to the country. Even though they might bring in a little forex, the loss of fine human capital does irreparable harm to the nation’s economy.

That being said, we must welcome this bold move of the Trump government. Nowadays, settling in the US is the only dream of many youngsters. Fantasized by the standard of living in the developed countries, these youngsters dream of settling there. Isn’t that a form of escapism? If your home is dirty, will you abandon it and settle in your neighbour’s house? Or, would you clean it up and live there peacefully? The brave will prefer the latter.

Despite enjoying highly subsidized education at premier institutes like the IITs and IIMs, the talented youth ends up being of little value to the nation’s development. It’s an investment gone waste. If this new policy of Trump can help India retain its skilled workforce in its own land, we can definitely turn India into a place better than the US!

Merger talks between Vodafone and Idea.

The following article is based on my own interpretation of the said events and/ or publicly available information. Any material borrowed from published and unpublished sources has been appropriately referenced. I will bear the sole responsibility for anything that is found to have been copied or misappropriated or misrepresented in the following post.

Avijit Nigam, MBA 2016-18, Vinod Gupta School of Management, IIT Kharagpur

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Vodafone is facing a stiff competition from Reliance Jio and in order to expand its user base and Revenue Market Share (RMS) it is said to be in consolidation talks with Idea Cellular. If the proposed merger takes place the new entity will be India’s largest telecom by revenue as well as subscribers toppling Bharti Airtel.

Such merger would face various impediments such as regulatory issues linked with spectrum caps, combined customer base and market share. Another issue to look into is that of Indus Towers stake. Currently, Bharti & Vodafone have equal stakes of 42% each while Idea owns 16%.

Entry of Jio has hit hard all the telecom companies after it provided free data and voice services since September last year. Bharti Airtel’s net profit fell to 504 crore which is its worst in four years. On the other hand, Idea is expected to report its first net loss ever since inception. So a merger at this point is well on cards..!!

My opinion: A merger is always a good option in order to overcome stiff competition and increase the market share. Also to deal with issues like Revenue market share and combined customer base both companies have sufficient time of one year. However blending corporate ecosystems of both companies and arriving at a healthy bottom line is yet to be observed.

 

Ban on Immigrants!!!

The following article is based on my own interpretation of the said events and/ or publicly available information. Any material borrowed from published and unpublished sources has been appropriately referenced. I will bear the sole responsibility for anything that is found to have been copied or misappropriated or misrepresented in the following post.

Jayita De, MBA 2016-18, Vinod Gupta School of Management, IIT Kharagpur

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US president, Donald Trump has recently signed an executive order banning refugees from six countries from 120 days. Ban on Syrian refugees is for indefinite time period. It is not important whether these six countries are Muslim countries or not, it is the question of humanity.

United State of America has always been the favorite destination for immigrants from all over the world. On that context, decision by US President has questioned the existence of all the immigrants in US. Currently, US immigrant population stood at more than 42.4 million or 13.3 percent of the total US population. So, if US continues with this BAN on these seven countries and even adds more countries in the list in future, it will definitely affect US economy.  All the famous US universities offer higher education to the students from all over the world. If this ban continues, the diversification, the unique feature of these universities, will not be there. Not only in the education sector, in the work force also the immigrants play a major role to control the economy.

Mr. Donald Trump defended himself as he wants to erase terrorism from US. But does terrorism belong to any country? The children from these countries could have studied in any of the US universities and could even play a major role to progress US economy. Those children are not at all part of the terrorism, so why they are paying off? Terrorism is a disease that can’t be stopped in this way. Education, economic development can be a remedy of this problem, not a ban on any immigrants will solve it.

The ball that should have been delivered earlier

The following article is based on my own interpretation of the said events and/ or publicly available information. Any material borrowed from published and unpublished sources has been appropriately referenced. I will bear the sole responsibility for anything that is found to have been copied, misappropriated, or misrepresented in the following post.

Sourav Ganguly, MBA 2016-18, Vinod Gupta School of Management, IIT Kharagpur

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Money is power, they say. And with great power, comes great responsibility. But, the recent developments around Supreme Court’s involvement in structural reform and its shot towards making sports administration cleaner and leaner has shocked many of us. It was not long back since we fought against issues like the tyrant hands of bookies pumping black money in BCCI, the allegations of corruptions against Indian Olympic Association regarding arrangements made during Commonwealth Games 2010, doping charges against the weightlifters, Political interference in various sports and netas overshadowing players. The nation now wants to know, should the honorable Supreme Court have interfered early? Is it too late to drive corruption away from BCCI, the governing body of Indian cricket?

Earlier this year, the bench led by CJI TS Thakur sacked BCCI president Mr. Anurag Thakur and secretary Ajay Shirke, as well as instructed BCCI to implement all the recommendations of Justice Lodha committee for a revamp of the BCCI. The SC also disqualified all the board and its state association office bearers who had failed to meet the new norms set by the committee. Indian cricket lovers were taken aback by the decision as it was the first major blow that the cricket governing body had ever received. The ugly truth of India ruling the cricket world by not only producing talented cricketers but also controlling powerful stake at International Cricket Council (ICC) was prevailing round the corner. The very reason behind the honorable court’s intervention was the irregularities in most of its member associations. Starting from the financial auditing of their accounts to indulging in group politics to bar former cricketers taking administrative roles, they were accused of several malpractices.

The BCCI is the richest sporting body. However, there is no uniform constitution. Every State has a different constitution that suits the ruling group. There are quite a few associations run by families for decades. Some have family members, trusted friends, relatives and employees of their establishments as voters. One association was even reported to have drivers and canteen staff as voters! With this structure, it was no wonder that respected former cricketer Kapil Dev lost the election of Haryana Cricket Association.

The Supreme Court’s impending decision of complete overhaul was long overdue. With politicians, public servants and government employees debarred from the association, the Lodha Committee has restrained the funding of the candidates. Implementation of the reforms might cause teething problems. But, in the larger interest of the game, the reforms will dismantle the monopoly of the BCCI and Indian cricket will witness a paradigm shift. Here is the spark that will definitely ignite the gentleman’s game for the better.