The future of Twitter could be very different. Here's why

With speculation mounting that Twitter Inc will soon have a new corporate owner, the 10-year-old social networking service - which has long struggled to define its core purpose -may end up heading in one of several distinctly different directions depending on who ends up paying for it.

Companies including Salesforce.com Inc, Walt Disney Co and Alphabet Inc's Google have shown interest in Twitter, which is working with investment banks to evaluate its options, according to people familiar with the matter.

With Salesforce.com, Twitter might turn its focus to customer service communications and mining its database of tweets for business intelligence. Google would likely be most interested in the social and news dimensions of Twitter. Disney, by contrast, might see it as a way to expand the reach of its sports and entertainment programming.

It is not clear how quickly Twitter might approach a sale, but it is moving to formalize the process, sources have said. A deal is by no means assured in light of the company's uncertain financial prospects and steep price tag - its market value is more than $16 billion after talk of a sale drove the stock up over the past few days.

Twitter Chief Executive Jack Dorsey, speaking at a conference in Washington on Monday, declined to comment on possible sale talks.

CORPORATE ROUTE?

Salesforce.com, run by CEO Marc Benioff, is focused on cloud-based sales and marketing software; unlike Twitter, its main product is aimed at businesses users, not consumers. Under Salesforce.com, Twitter could become a corporate tool used to power sentiment analysis and nurture customer relationships.

Salesforce.com already uses the Twitter "firehose" for its new artificial intelligence platform, Einstein.

"It would give them the social graph and a better idea of how social media relates to its customers," said Ryan Holmes, chief executive of Hootsuite, a private technology firm that helps brands and consumers manage their social media accounts.

Holmes also said that if Salesforce.com owned all of Twitter's data, it could have better insights into what sort of conversations companies such as airlines or telecom firms might be having with their customers and thereby gain more understanding of their business challenges.

But many Twitter users - especially newer ones - are not active tweeters, which over time could limit the value of the data Twitter can provide. Salesforce.com could also likely gain much of the benefit of Twitter's data from licensing its trove of tweets as opposed to buying the whole company.

Salesforce.com investors are already spooked by the speculation it could acquire Twitter: its shares are down 6 percent since news of the company's interest flared up last week.

GOOGLE AD PLAN

Twitter would fit easily with Google's online advertising-driven business model. Ads could be sold across paid search, YouTube, display and mobile on Twitter - while filling a gap for Google, which has struggled with social media.

"Google already has the eyeballs with advertisers. Cross-selling to the Twitter inventory could be an amazing play for them," Hootsuite's Holmes said.

Google, which has expertise in monitoring its video service YouTube, would know how to deal with the tricky policy issues facing Twitter, such as abusive tweets and censorship.

Still, such a tie-up faces potentially fatal regulatory hurdles, analysts said. In Europe, where the company has a bigger share of the search market than in the United States, the company is already facing two antitrust investigations.

"Google could help Twitter's user acquisition problem. The unknown is whether regulators in the United States and European Union would allow the transaction," said BTIG analyst Rich Greenfield.

Facebook Inc, meanwhile, has been trying to replicate Twitter on its own platform and could also face antitrust challenges if it tried to buy the company, Greenfield said. So far Facebook has not been mentioned as a potential buyer, but with its large cash reserves and penchant for surprise moves it cannot be counted out.

THE MEDIA PLAY

Twitter's foray into live streaming of National Football League games and its presence in news gathering could interest media companies such as Disney, which owns sports channel ESPN.

Twitter's presence on mobile devices could help any media company, all of which are struggling to find mobile growth, according to BTIG's Greenfield. No media company has a mobile product with as much reach as Twitter, he noted.

"The world of media is shifting to mobile and these newer platforms are becoming the future," Greenfield said.

Still, media companies do not have the best track record with social media. News Corp's acquisition of MySpace in 2005 ended in disaster. And some question whether the media companies and top personalities that have been so important to Twitter would stick around if a rival media firm were the owner.

Google brings Wi-fi station, data-light YouTube for India

Tech giant Google on Tuesday announced a bouquet of new products for the Indian market that are suited to work with low Internet speeds.

These include a new Wi-Fi platform called Google Station, a video app called 'YouTube Go' and an offline feature for Chrome web browser and faster loading in Google Play on 2G network.

Outlining the three key areas of focus -- access, products and platforms -- Google Vice President (Next Billion Users) Caesar Sengupta said that the US-based company is working to provide a better and more inclusive online experience for users in India.

"Our goal has not just been to help more Indians get online, but also to help Indians create the online experience they want. So, we have been thinking about how to build products and services for this wave of new users products that work for any level of connectivity, in local Indian languages, and across the devices that are most frequently used in India," he added.

Following its partnership with RailTel and Indian Railways to provide Wi-Fi at Indian railway stations, Google has now launched a new platform called Google Station.

The new platform will work with partners like system integrators (SIs) and venue owners to roll out Wi-Fi hotspots, Sengupta said.

He added that this will provide more people in India and around the world fast, reliable, and secure Wi-Fi in places like malls, transit stations, and cafes.

Besides, users on a low-bandwidth connection will now be able to choose and install an app through their mobile network or install it when the phone next connects to Wi-Fi.

Google is also focusing on the next million of users who will come online in the coming years in regional languages other than English.

Its new messaging app 'Allo' will introduce support in Hindi for its Google Assistant later this year, Amit Fulay, Group Product Manager at Google, said.

Google has also announced a group of tailored features for Chrome, like automatic optimising of pages when 2G-like networks are detected. These simplified pages load up to 2X faster, saving more than 90 per cent of data usage. This data saver feature will now support videos as well, helping users save upto 67 per cent data.

Rajan Anandan, Vice-President, India and South East Asia said the company's vision is to make India a global hub of innovation and produce high quality mobile developers who will build not just for India but for the world.

India is one of the fastest growing markets for Internet usage. The user base, driven primarily by booming smartphone adoption, is pegged to grow from 350 million to 650 million by 2020.

The smartphone base in the same period is poised to grow to 500 million from 300 million in 2016.

Seven takeaways from Anil Ambani-owned Reliance Capital's AGM

Industrialist Anil Ambani on Tuesday addressed shareholders at Annual General Meeting of Reliance Capital, the financial services arm of the business conglomerate headed by him. From his son Anmol Ambani to listing of his home finance venture on the stock market, below are seven key takeaways from the RCap's AGM, held today in Mumbai:

1)On Anmol Ambani

Introducing son Anmol as a new director on Reliance Capital's board, Ambani said he has brought "tremendous luck" with a 40 per cent surge in share price since his induction and hoped that the 'Anmol Effect' will continue further.

Thanking the shareholders at the company's Annual General Meeting for their "vote of confidence" in 24-year-old Anmol's appointment as an Executive Director, Ambani said his son is "part of this younger demography and will relate to the future customers, shareholders, employees as well as the other stakeholders of Reliance Capital".

On listing of Reliance Home Finance

Betting big on the financial sector, Ambani said Reliance Capital expects to list its home finance arm separately by April 2017. He expects the listing to take place by April next year and added that the company will be well-capitalised.

"49 per cent stake in the listed company will be held by you," Ambani told the shareholders of Reliance Capital while adding that the allotment of the shares will be made "free of cost" and the listing would unlock significant value for them.

On commercial lending

Ambani said the commercial lending and insurance arms can also be listed separately at an "appropriate time". However, he added the approach should be of 'optional listing', rather than mandatory listings and any decision of separate listing of Reliance Capital's various arms will be taken after looking into the interest of the shareholders.

"The transfer of commercial finance business into a separate subsidiary will enhance management focus and provide flexibility to unlock value through stake sale," said Ambani.

On re-launch of commodity exchange

The company will develop a new vertical for consumer lending business for better growth and profitability and will re-launch its commodity exchange with focus on diamond and crude oil futures. Diamond futures will be the flagship product with potential daily turnover of over Rs 6,000 crore.

On monsoon and GST

Expecting good monsoon, a low interest rate framework and benign inflation to drive tremendous growth in Indian economy, while expecting GST to be a game-changer, Ambani listed out several initiatives to "reap the benefits of this opportunity in financial services".

On dividend payouts

Ambani said the company is committed to growing its dividend payouts every year.

On Nippon Life

On Reliance Capital's partnership with Nippon Life, Ambani said their Rs 9,000-crore investment in life insurance and asset management businesses represents the largest FDI from Japan in India.

Adani buys Australian port operator from Glencore

A unit of Adani Enterprises will buy the company that operates Australia's Abbot Point Coal Terminal from Glencore Plc for A$19.25 million dollars ($14.52 million), ending a legal wrangle over control of the port.

The statement from Adani and Glencore said Adani Ports and Special Economic Zone  would purchase the port operator, Abbot Point BulkCoal Pty Ltd, pending regulatory approvals.

Adani Enterprises, India's biggest private sector coal trader, acquired the Abbot Point Coal Terminal port from the Queensland government in 2011, considering it a key part of its plan to ship coal from Australia to India and for other exports.

However, Glencore retained control of the actual operations of the port through its ownership of Abbot Point BulkCoal, sparking a legal dispute between the global miner and Adani that effectively will now end as the Indian company will assume full control of the port.

Adani Australia CEO Jeyakumar Janakaraj called the deal "a key milestone in our well advanced plans for Abbot Point," according to the joint statement by the two companies.

Google's intelligent messaging app, Allo to launch on September 21

According to popular tipster, Evan Blass, Google will roll-out a new messaging app on September 21.

During the I/O conference this year, Google announced a new messaging app, Allo. This app was scheduled to launch by summer-end and it seems Google will stick to the calendar with its launch.

In the already crowded market of messaging applications, Google will try to introduce ease of log-in and new AI-generated  features to compete with applications like Messenger and WhatsApp.

Allo's standout feature will be the assitance of Google's AI in providing contextual replies to your texts.

For instance, if you receive a text saying, 'let's all go out tonight', you can simply tap on the prompt button to generate a response like, "I'm in". 

Other than that, the app will also be able to recognise content within images to provide contextual replies. For instance, if you receive a picture of a baby, the prompt feature will generate a response like "so cute!"

Google claims to be sophisticated enough to recognize things like dog breeds and types of pasta with up to 90 percent accuracy.

Allo will also come with Google Assistant, whom you can chat with, in the form of a contact. The search bot will not only answer your questions but also suggest additional data and media while texting another person via the app.

Other than this feature, Google will also claim an end-to-end encryption of messages, temporary private messages, stickers and other text formatting options.

To grant easy access to the app, the user will just need a mobile number to register an account.

Since Evan Blass(@evleaks) is a credible tipster, the date of launch is almost certain and we will soon have  our hands on the application.

Stay tuned for our first impressions regarding Google's Allo.

New smart cities will boost business in realty sector, says realtors' body

Realtors' body NAREDCO today hailed the government's announcement of 27 more cities for the development of smart cities, saying the move would provide business opportunities for the real estate developers.

Prime Minister Narendra Modi's Lok Sabha constituency Varanasi along with holy cities of Amritsar and Ajmer has made it to the list of 27 smart cities announced today.

Under the Smart City Mission, the government aims to have 100 smart cities by 2022. Sixty have been chosen so far, including 20 in January and 13 in May this year.

NAREDCO President Parveen Jain said the inclusion of cities like Agra, Amritsar, Ujjain, Varanasi, Tirupati and Vellore etc will boost the tourism sector as well as bringing up these cities on global tourism map.

He said the development of smart cities would lead to well planned urbanisation with aesthetic beauty comparable to international standards.

National Real Estate Development Council (NAREDCO) sees immense opportunities for the real estate industry in transforming these selected cities.

Commenting on the development, Arindam Guha, Senior Director, Deloitte in India, said: "The Smart City Challenge continues to generate significant enthusiasm throughout the country. With the addition of these 27 cities, a total of 60 cities are now eligible for funding under the programme."

The high interest and participation levels in the Smart City plan development phase now needs to be sustained through quick implementation on the ground, he added.

Shrinivas Kowligi, Partner - Smart Cities and Urban Transformation, EY India, said: "With now 60 cities across India eligible for funding support from government of India, the biggest challenge is going to be talent and expertise both within and outside the government."

The competencies needed for addressing the myriad challenges Indian cities face, and to handhold them in their journey to get smart, requires diverse technical skills, project development and management expertise.

"Ministry of Urban Development now needs to drive transformational initiatives to scale up human resource capacity in the country to address this challenge," Kowligi said.

Snapdeal to take on Flipkart, Amazon with 'Unbox Diwali Sale' from Oct 2

E-commerce firm Snapdeal said on Tuesday it will flag off the festive season with its 'Unbox Diwali Sale' from October 2, the same day when its larger rival Flipkart will begin its ownfestive offers .

The first Unbox Diwali Sale will run from October 2-6 and will see exciting deals and offers across all categories like home appliances, electronics, mobiles, home furnishings, furniture and FMCG, Snapdeal said in a statement.

Shoppers will be able to choose from a wide range of products at great value hourly deals, with discounts up to 70 per cent, it added.

Flipkart will host its 'Big Billion Days' sale during the same period. Amazon.in is yet to announce its sale days.

According to analysts, this year's festive sales may be impacted by recent guidelines by DIPP that bar e-commerce players from doling out steep discounts.

The players have been investing significantly to ramp up delivery and logistics capabilities to meet the surge in demand during the festive season.

"We are entering this season with the widest assortment, key brand partnerships and exclusive line of products... Our superfast deliveries and free shipping options through Snapdeal Gold will add further sparkle to festive offerings," Snapdeal V-P and Head of Categories Saurabh Bansal said.

In a separate announcement, Snapdeal said it has appointed Mayank Jain to head supply chain at the company.

As President SCM (supply chain management), Jain will spearhead the complete operations and supply chain function at Snapdeal. He takes over from Ashish Chitravanshi, Senior Vice-President Operations, who is moving out to pursue other interests.

Jain had joined Snapdeal in March 2013 as Assistant Vice-President and Head of Seller services. He has previously worked with firms like ITC, Urban Touch and Fashion and You.

CBI arrests ex-bourse king Jignesh Shah

CBI on Tuesday arrested promoter of FTIL and commodity bourse MCX Jignesh Shah in a case of alleged cheating and suppression of facts in getting SEBI extension to MCX-SX to continue as a private stock exchange in violation of norms.

"The Central Bureau of Investigation has today arrested a promoter of two private companies and conducted searches at nine places in Mumbai, including the residence and office premises of the said promoter of Mumbai-based two private companies," CBI spokesperson R K Gaur said on Tuesday.

The move came after CBI searches at nine locations, including the premises of Shah, FTIL, MCX, senior SEBI officials --Executive Director Muralidhar Rao, DGM Rajesh Dangeti and AGM Vishakha More-- and a former Executive Director of SEBI, J N Gupta, in connection with the case registered two years ago, the sources said.

MCX-SX had started functioning as a stock exchange in 2013 after a long legal battle with SEBI.

Meanwhile, 63 moons (formerly known as FTIL), said in a statement, "Pursuant to the applicable regulations of SEBI (LODR), Regulations 2015, please be informed that Central Bureau of Investigation, Economic Offence Wing, Mumbai, is conducting search in connection with FIR ... relating to recognition granted by SEBI to MCX-SX (now Metropolitan Stock Exchange of India Limited)."

MCX also gave a statement to BSE, saying the CBI search is going on in respect of recognition granted by SEBI to Metropolitan Stock Exchange of India Limited (formerly known as MCX Stock Exchange Limited) for starting its stock exchange in trading in currency and other segments in respect of case no. RC 9/E/2014".

CBI had filed the FIR in the case under IPC sections related to criminal conspiracy and cheating besides provisions of Prevention of Corruption Act for alleged abuse of official position.

The agency had alleged that the promoters of MCX-SX had entered into a buy back arrangement with a nationalised bank in violation of Securities Contract Regulation Act, 1956 and Securities Contract (Regulation) (Manner of Increasing and Maintaining Public Shareholdings in Recognised Stock Exchanges) Regulation, 2006.

CBI had alleged that Shah, in connivance with SEBI officials, deliberately suppressed this material fact while applying for extension of recognition of the stock exchange, to conduct trade in currency derivatives, and fraudulently obtained the extension of recognition of the exchange in the year 2009 by cheating SEBI.

The agency further alleged that the SEBI officials deliberately did not issue notice to the stock exchange for cancellation of its recognition in the currency derivatives, when SEBI had already rejected request of the same stock exchange for trading in other segments.

Ola ties up with Yatra.com

In Transportation app Ola has integrated its application interface on Yatra.com in a bid to tap into the travel portal's consumer base.

Through this integration, users will be able to book a ride directly through Yatra.com's app without having the Ola application installed on their devices.

The integration is planned to go live this week. It will give customers, access to availability, booking, estimation and tracking across categories, directly on the Yatra app, sources said.

Interestingly, Ola's US-based rival Uber had announced a similar partnership with eCommerce major Snapdeal in August. Yatra is considered as one of the highest rated online travel agents (OTAs) in India...This API integration will help Ola tap into millions of Yatra's customers, they added.

Ola has also opened up its Application Programming Interface (API) to other apps like Makemytrip, Oyo Rooms and others in the past to extend its mobility offerings to a larger user base

Six reasons behind Ramdev, Balkrishna and Patanjali's success

In 1995, Ramdev was a little known yoga teacher in Haridwar when his close associate, Acharya Balkrishna, and him set up Divya Pharmacy - under the aegis of Ramdev 's guru, Swami Shankar Dev's, ashram - to make Ayurvedic and herbal medicines. The medicines proved so popular that Ramdev and Balkrishna sought to scale and diversify into other products. But that proved difficult since Divya Pharmacy was registered under a trust.

At the same time, with Ramdev's popularity soaring, substantial funds began to come in - sizeable loans from the likes of NRIs Sarwan and Sunita Poddar, as well as locals such as Govind Agarwal - which in turn helped to get bank loans. Thus was born Patanjali Ayurved as a private company in 2006, which has since rolled out a range of products - in healthcare, hair care, dental care, toiletries, food and more - at breathtaking speed.

"When Divya Pharmacy was set up, we hardly had the money to pay for the registration," Ramdev told Business Today last year. "For the first three years, till 1998, we distributed the medicines free. From buying the raw materials to grinding and mixing, we did everything ourselves," he added.

Today, Balkrishna stands among the richest men in India and Patanjali as one of the main players in the Indian fast moving consumer goods (FMCG) sector . While Ramdev is busy propagating Yoga and Ayurveda to create a market for the products, Balkrishna is creating the products.  Their partnership has been phenomenal, but there are also many other reasons behind the success story:

Media attention: Ramdev rose to national fame as a yoga guru through his programmes on TV channels - Sanskar in 2001 and Aastha from 2003. He readily acknowledges the role of the media in his rise. "Patanjali ko bananey mein ek se 10 per cent humara role hai, baaki role media ka hai (My own role in the rise of Patanjali is just one to 10 per cent, the rest of the credit goes to the media)," he told Business Today website.

Smart pricing: Yet another reason for Patanjali's success is the thrift it practices. "Our profit margins are miniscule because the main aim is not to make profit," said Ramdev. "Profiting from patients is against the philosophy of Ayurveda, so we aim at minimum profit from our health products. Our input costs are low because we source directly from farmers, avoiding middlemen." Salaries are also modest. "Humare yahaan crore ki salary paane waala koi vyakti nahee hai, (There is no one in our company who is paid crores as salary)," he added. "Most companies have administrative costs of around 10 per cent of their revenue, but in our case it is just two per cent."

Retail outlets: Initially, Patanjali shunned the conventional distribution network, preferring to rely on its own channels of super distributors, distributors, Chikitsalayas (franchise dispensaries) and Arogya Kendras (health centres which sell Ayurvedic remedies). Once it turned to retail outlets from 2011, revenue began to multiply manifold.

Variety of products: Already, a few Patanjali products have made major inroads - apart from desi ghee, its toothpaste Dant Kranti, for instance, launched in March 2010, brought in revenues of Rs 200 crore in 2014/15. Patanjali has also ventured out to produce many other new items that were mostly produced by foreign companies in recent months. Patanjali also sells toothpastes, unpolished pulses and detergents.

Swadeshi factor: Patanjali is happy to co-exist with indigenous companies, multinational ones are a different matter. "Humara ek simple funda hai: MNCs ko replace karna (We have a simple principle: we want to replace MNCs)," said Ramdev.

"We don't want to put anyone down, but we would like to instil swadeshi pride so that Indian money does not go out of the country." He is aware that the competition is gunning for him.

"The MNC mindset is such that whenever an Indian does anything, MNCs think we are competing with them," he said. "MNCs are creating special war rooms to combat Patanjali. We are not into any such war rooms. We don't analyse other companies' strategies or conduct market surveys and feasibility studies. It is only when people ask for cheap and healthy options that we try to respond."

Advertising: Patanjali's own advertising was limited in the past, but has increased considerably of late, with ads appearing on general entertainment TV channels (GECs) such as Star and Zee. The company has also reached out to regional Southern channels.

Air India warns of exemplary action after pilots skip work

Air India on Monday warned of exemplary disciplinary action against employees sabotaging the progress of the national carrier after some pilots did not report for duty in protest against non-payment of allowances and other issues, partially affecting its operations on Sunday.

"Such acts, especially at this juncture when all are making efforts together to achieve a turnaround in the organisation and focusing on welfare of employees, are just not acceptable and shall not be tolerated under any circumstances," Air India Chairman and Managing Director Ashwani Lohani said in a stern message.

Recently, there have been delays/cancellations of flights due to indiscipline by a small section of pilots.

Such instances, besides loss of revenue, cause tremendous inconvenience to passengers and lower the image of the organisation, he said. Such attempts at sabotaging the progress of Air India and also instigating by mischievous elements shall not be tolerated under any circumstances and employees responsible for the same shall be liable for exemplary disciplinary action, he said.

Domestic flight services of the government-owned airline were partially affected on Sunday after a section of pilots, owing allegiance to the Indian Commercial Pilots Association (ICPA), decided not to report for duty in protest against pending issues related to salary and allowances, besides alleged denial of weekly-off.

On September 1, the ICPA had flagged continuing pay anomalies in a strongly-worded letter to Air India's Director (Finance). Our patience has run thin. We will wait till September 7 for the anomalies in pay and allowances to be corrected and international layover allowance to be paid up to date failing which we will be forced to take any action as deemed fit to safeguard the interests of our members, ICPA had said.

The pilots are also angry over the delay in payment of international crew layover allowance that they are entitled to when flying abroad. Some pilots who fly narrow-body, mainly Airbus A320, aircraft did not turn up for duty on Sunday, affecting operations of around 10 to 12 flights. After some ICPA pilots stopped taking duty calls about their respective flight schedules, Air India management was forced to deploy wide-body Boeing 777 and 787 pilots for operations on key trunk routes such as Mumbai, Chennai, Hyderabad, Bengaluru and Kolkata. ICPA represents around 750 pilots, majority of whom are from erstwhile Indian Airlines. 

5 Challenges ahead for the new RBI Governor Urjit Patel

Former Deputy Governor, Urjit Patel has been appointed as the 24th head of Reserve Bank of India. The formal oath taking ceremony will be held Tuesday when he will be formally inducted into office.

Patel served as RBI's deputy governor since January 2013 and was in charge of monetary policy.

Serving over 43 months in the Central Bank, Patel isn't a stranger to what the title necessitates. As RBI Governor, however, Patel has inherited a number of unfinished tasks.

"The job of RBI governor is not only the monetary policy, RBI governor also looks into the regulations of banks, and non banking financing companies. In that role he has to ensure the smooth running of the financial sector," Economic Affairs Secretary Shaktikanta Das said.

From cleaning up bank balance sheets and unclogging credit pipelines to ensuring economic growth, here are the five challenges that lie ahead of the new RBI chief:

1. Inflation

Inflation is on the rise with food prices leading the way and oil prices ticking up in the global scenario. In June, Consumer Price Index rose to a 22-month high of 5.77 per cent, above the 5 per cent comfort zone.

The RBI's monetary Policy framework to target inflation is containing the number to less than 4 per cent. Patel who is known to favour low inflation in the economy has this as a major task ahead of him.

2. Growth

Patel will have to heavily focus on growth after the quarterly results reported a 7.1 per cent growth, slowest since April to June Quarter in 2014 where the rate was 6.7 per cent.

The government's target is 8 per cent in the year.

"He (Patel) will keep in mind the inflation target and the monetary policy. He will also keep in mind the requirements of growth which is a mandate of the Reserve Bank of India Act," Economic Affairs Secretary Shaktikanta Das said.

"In particular, he has to ensure flow of credit to various sectors of economy, in particular agriculture and the MSME (Micro, Small and Medium Enterprises) sectors," he said.

3. Interest Rate

When Patel chairs his first meeting of the Monetary Policy Committee he will have to decide interest rates from October 4th policy announcement.

However, Patel will have to keep in mind to balance interest rate and the need to stimulate growth.

4. PSU banking reform

India's Public Sector Undertaking Banks needs structural and financial changes and is still an unfinished business. Asset quality resolution process, problem of NPAs and bad debts pose as prime hurdles of the stressed banking sector in India.

5. Exchange Rates

Due to political pressure and perception, the government demands a stronger rupee. On the other hand, economically there may be a case for further depreciation in the currency.

The challenge Patel will have to come over is to maintain domestic currency at a level between 65 and 70 rupees to the dollar.

Sony slashes prices of Xperia X, Z5 Premium by up to Rs 10,000

Sony India has reduced prices of its flagship devices, Xperia X and Z5 Premium, by up to 21 per cent.

The reduction, effective September 1, will see Xperia X being sold at Rs 38,990. This is lower by Rs 10,000 or about 21 per cent from the launch price of Rs 48,990 in May this year. Similarly, the Xperia Z5 Premium will now be priced at Rs 47,990, which was earlier available at Rs 55,990 at the launch in October 2015.

This translates into a reduction of Rs 8,000 or 14 per cent. The new price is effective from September 1, 2016, Sony India said in a statement. Sony India plays in the mid and premium category in the Indian smartphone market, which is among the fastest growing in the world.

According to research firm IDC, smartphone market in India saw a 17.1 per cent sequential rise in shipments to 27.5 million units in the April-June 2016 quarter, with Chinese vendors like Lenovo, Xioami and Vivo driving the growth. The largest player in India is Samsung (25.1 per cent), followed by Micromax (12.9 per cent), Lenovo Group (7.7 per cent) and Intex (7.1 per cent). 

Bharti Airtel could lose revenue, but may withstand Reliance Jio: S&P

Bharti Airtel's revenue growth in India may halve over the next two fiscals, but it has enough room to weather Mukesh Ambani-led Reliance Jio's disruptive entry into the telecom market, S&P Global Ratings said on Monday.

"We expect Bharti Airtel's operating performance to weaken because of competitive data tariffs and free voice calls," the agency said.

S&P said the impact of Jio's entry is uncertain, but on a conservative basis, it assumes that "revenue growth for its (Airtel) domestic business could decline to below 5 per cent during the fiscal year ended March 31, 2018 and fiscal 2019, from about 10 per cent in fiscal 2016".

The agency also said its credit rating on Bharti Airtel is unaffected by higher competition with the launch of Reliance Jio.

"Based on our forecasts, we consider Bharti Airtel has financial headroom to withstand weaker operating performance from intensifying competition. Reliance Industries provides fourth generation (4G) services under the Jio brand...," S&P said.

This is despite the assessment that Bharti Airtel's funds from operations to debt could decline to about 23 per cent for the next 2-3 years, from 25.4 per cent in 2015-16, which is materially above S&P's downgrade trigger of 20 per cent.

"The rating on Bharti Airtel remains vulnerable if significantly higher spectrum acquisition costs and a weaker operating performance than our expectations were to occur and Bharti Airtel fails to make commensurate measures to offset the financial deterioration," S&P said.

The agency assumes that Ebitda margin for the company's Indian operations could tighten by 300-400 basis points to about 37 per cent in 2018-19, from 41 per cent in 2015-16.

"This pressure could ease in the long term as the current competitive environment will accelerate consolidation in the Indian telecom sector," the agency said.

Bharti Airtel, according to S&P, is best placed among the incumbent players in India to compete with Reliance and should be able to maintain its strong market position with over 250 million customers.

"Moreover, Bharti Airtel has first-mover advantage in 4G technology, having launched the services in many parts of the country over the past 1-2 years. In comparison, Reliance Jio has just launched commercial services and has about 1.5-2 million customers," S&P said.

It feels that Bharti Airtel could support its financial ratios through strategic measures such as the sale of Bharti Infratel shares, given that it can reduce its 71.7 per cent holding to 51 per cent without losing control.

"Every sale of a 5 per cent stake in Bharti Infratel can provide $500 million of proceeds. This could help offset the potential adverse impact of Bharti Airtel's spending in the upcoming spectrum auction, which we assume would cost about $1 billion," S&P said.

Services growth hits 3.5-yr high, room for rate cut

Services sector grew at its fastest pace in over three-and-half years on surge in domestic and overseas orders, but prices remained subdued leaving room for RBI to cut interest rates, a monthly survey showed on Monday.

The trend in job market remained muted due to uncertainty regarding the sustainability of the upturn in demand.

The Nikkei India Services Purchasing Managers' Index (PMI), which tracks changes in activity at services sector companies on a monthly basis, stood at 54.7 in August, up from 51.9 in July.

This marks an uptrend for 14th straight month. A reading above 50 means the sector is expanding, while a reading below that level means contraction.

Service sector showed upbeat levels of performance in August. New business was the main driver of activity growth, even amid increased competition for new work, Pollyanna De Lima, economist at IHS Markit, and author of the report said.

The level of incoming new work rose at the quickest pace in three-and-a-half years and companies mainly linked this to improved market conditions. With growth of manufacturing production also ticking higher, the Nikkei India Composite PMI Output Index, climbed from 52.4 in July to a 42-month high of 54.6 in August, highlighting a stronger improvement in private sector economic activity. Meanwhile, the trend in employment remained comparatively subdued, however, with a slight decrease in jobs signalled for the first time since September last year.

The numbers of in-house staff fell, however, as firms remained somewhat uncertain regarding the sustainability of the upturn in demand, Lima said, adding a further uptick in backlogs may lead service providers to create jobs in coming months. Stronger business activity growth and incoming new work led to modest recovery in optimism at service providers.

Over 27 per cent of companies expect activity to increase over the coming year. Healthy levels of confidence were also signalled, with firms expecting greater client interest and improved market conditions to underpin output growth in the year ahead. All-in-all, PMI data suggest that the service sector looks set to maintain its strong performance in the months ahead, Lima said. On prices front, the survey noted inflationary pressures in service sector remained subdued in August. Average costs declined marginally for a second successive month, which firms attributed to lower diesel, fuel and vegetable prices.

Meanwhile, average service charges ticked higher. The easing of inflationary pressures leaves room for rate cut by RBI, which is scheduled to hold its next monetary policy review-probably the first by a new committee being set up-on October 4.

It would also be the first review under the new RBI Governor Urjit Patel, who has assumed charge effective September 4 after end of his predecessor Raghuram Rajan's three-year tenure. Rajan had faced a lot of criticism for his reluctance to cut rates, though he always maintained that the rates were lowered at every given opportunity. 

Jio's entry: Fitch sees tariff rates falling by 10-15% in 1 yearr

The start of full-fledged 4G services by Reliance Jio will prompt incumbent operators to lower their tariffs to retain customers, and industry blended tariff could fall by 10-15 per cent in the next year, Fitch Ratings said today.

"The incumbents are likely to respond by lowering their own tariffs to retain customers. We expect the industry blended tariff to fall by 10-15 per cent in the next year," Fitch said.

It said Reliance Jio's entry will be "credit negative" for the incumbent operators, particularly smaller telcos, and will hasten industry consolidation.

Reliance Jio, whose services are available from today to all potential users with 4G-compatible handsets, is offering customers free voice and data under 'welcome offer' valid up to December 31, after which users will be given free voice calls for life and data plans at about one-fifth the market prices.

"Rising competition will lead to downward pressure on data tariffs at a time when capital expenditure will have to increase to support rising data consumption as cheaper 4G handsets become available," Fitch said.

It said Jio's blended tariff rates are at least 20-25 per cent cheaper than those of the incumbent telcos, given the lower data charges, and free voice calls or text messages.

The recent rise in data average revenue per user (ARPU) will soon start to reverse and cannibalisation by data services will continue to reduce voice ARPU, it predicted.

"Jio's tariff plans may gradually push the market toward 'data-only plans', under which customers are charged only for data, not for voice and text messages. Such a shift could be particularly disruptive, given that most incumbents still derive the bulk of their revenue and profit from voice and text messages," it said.

Jio, said Fitch, is likely to be "loss making at the EBITDA level for the first two years".

"Currently, fewer than 5 per cent of Indian consumers have such (4G-compatible) handsets. However, this is likely to change quickly, as over 70 per cent of new handsets are now 4G, but it is unlikely that Jio will be able to win more than 20-30 million subscribers and 3-4 per cent revenue market share over the next year," it added.

The top-four telcos' average operating EBITDA margin is likely to narrow by at least 200-250 basis points (against 35 per cent in 2015) in the next year.

Fitch has reiterated negative outlook on Indian telco industry, given the competition, large capex needs and prospect of debt-funded M&A activity.

"The Indian telco industry should continue to consolidate and we expect five to six operators to emerge from the shake-out. Unprofitable telcos, such as Telenor and Tata, could exit, given that their businesses will struggle to compete and they are now able to monetise their most valuable assets - their under-utilised spectrum," Fitch added.

Azim Premji meets Sitharaman, discusses US visa fee hike

Commerce and Industry Minister Nirmala Sitharaman on Monday met Wipro Chairman Azim Premji and is understood to have discussed visa problems being faced by Indian professionals in the US.

Time and again, India has raised the issue of hike in visa fee by the US. It has also filed a case at WTO against the US decision to impose high fees on temporary working visas.

The Americas accounted for 53.5 per cent of the company's total IT services revenue during the first quarter of this fiscal. Wipro is India's third-largest software services firm.

Recently, at the India-US CEO Forum meeting in New Delhi, the Indian side flagged its concerns over the visa fee hike in the US.

The US assured India that it will look into the concerns.

However, it maintained that the decision was not targetted against Indian professionals.