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News digest: Shortage of vital drugs, Fairfax-CSB deal, IL&FS, and more

BigBasket also wanted a seat on the board of Paytm Mall

BS Web Team  |  New Delhi 

News Digest

may acquire majority stake in BigBasket, talks on fast track

Paytm Mall, Paytm’s e-tail platform, could soon pick up a majority stake in online grocery provider Sources said that discussions on the deal, which began last year, were on a fast track.

A Paytm spokesperson denied that the company was in talks with However, according to sources, the company has been trying to team up with an e-grocery provider ever since there were rumours last year that Walmart wanted to tie up with an e-commerce partner in India.

In February, Paytm’s backer invested $200 million in While closing the financing round, the Chinese tech and e-commerce giant told the Bengaluru-based company about its plans to buy a majority share in the firm and has been pushing for the purchase ever since.

According to sources in BigBasket, the talks were stuck over the valuation of the company. BigBasket also wanted a seat on the board of “Negotiations are still on. BigBasket wants the company to be valued at a premium,” said a source. Read more

India may face shortage of drugs as supplies from Chinese companies dry up

Apart from Vitamin C, there is currently no shortage of medicines in chemist shops, but this situation could change soon. Industry insiders say antibiotics, steroids, and other drugs are becoming hard to find because sourcing bulk drugs from China continues to remain a challenge.

Almost 60 per cent of India’s bulk drugs are imported from China. Supplies have been disrupted owing to Chinese companies upgrading their plants or shutting down over environmental concerns.

The data shows a dip in volumes for formulations for which bulk drugs or chemical compounds used in producing active pharmaceutical ingredients (APIs) are not available in India. Industry sources say that since the situation is unlikely to ease, there could soon be a shortage of medicines. “The pipeline stock is getting liquidated and soon there will be production cuts at various manufacturing units,” said a source. Read more

Crisis-hit IL&FS to raise Rs 150 bn, hike borrowing limit to Rs 350 bn

IInfrastructure Leasing & Financial Services (IL&FS) has again defaulted on repaying loans — this time the amount in question is about Rs 2.7 billion — even as it received the shareholders’ nod to raise up to Rs 150 billion through debentures.

Cash-strapped IL&FS informed the BSE on Sunday that the company was unable to service its obligations on account of loans from banks and financial institutions of Rs 2.23 billion due on September 28 and Rs 470 million due on September 29.

Earlier, it could not service repayments due on September 18 and 14. Also, there was a delay in servicing some inter-corporate deposits, which resulted in the downgrading of the company.

Now the group flagship and holding company, IL&FS, and key group entities carry either the default ‘D’ grade or a sub-investment grade rating. Read more

Six months later, Fairfax Holdings and CSB deal still stuck in govt files

It has been more than six months since Prem Watsa-promoted Fairfax Holdings said it would infuse Rs 12 billion into (CSB) for a 51 per cent stake. However, the finance ministry is yet to clear the deal, though the Centre had said it would clear such foreign direct investment (FDI) proposals in 8-10 weeks.

The Reserve Bank of India had approved the first stake sale of an Indian bank to a foreign non-banking entity in July.

C V R Rajendran, chief executive officer of CSB, speaking on the sidelines of the bank's annual general meeting at Thrissur, said, "They may be taking time as this is the first such case. We are hopeful of getting all the approvals and the money by next week.” Read more

Eastern zone emerges fastest-growing market for auto firms; up 17%

The smallest contributor to domestic car sales by region, the eastern zone, is now the automobile industry’s fastest-growing market, thanks to a rise in consumer spends. The region’s passenger vehicle, or PV (cars, vans, and utility vehicles, or UVs) sales grew at 17 per cent in 2017-18 (FY18), compared to a 12 per cent growth in the North, 6 per cent in the West, and 3 per cent in the South. The trend has continued in the current year. Of the eight states that grew more than 30 per cent in the first quarter (Q1) this year, five (Assam, Bihar, Sikkim, Nagaland, and Mizoram) happen to be in the East.

The data shows that the industry’s in the eastern region surged 27 per cent during the April-June quarter of the current financial year. The western region, the biggest by volume, saw a growth of 18 per cent. The northern and southern zones clocked a growth of 20 and 19 per cent, respectively. The eastern region accounts for about 12 per cent of the industry’s total sales and therefore, low base is a factor in high growth. Read more

First Published: Mon, October 01 2018. 01:49 IST