Connect with us
Sunday,16-January-2022

Business

CAIT asks Piyush Goyal to direct CCI probe into Amazon, Flipkart

Published

on

Amazon-and-Flipkart

A day after the Karnataka High Court judgement dismissing the petition of Amazon & Flipkart, the Confederation of All India Traders (CAIT) on Saturday sent a communication to Union Commerce Minister Piyush Goyal urging him to direct the Competition Commission of India (CCI) to immediately initiate investigation proceedings against Amazon and Flipkart without any further ado.

The CAIT has also urged Goyal to immediately issue a fresh Press Note replacing Press Note 2 of the FDI policy with a Monitoring mechanism to ensure that law of the land prevails and no one should dare to violate the policy, law or the rules. The CAIT has also proposed that to bring greater transparency in e-commerce business, every company indulging into any e-commerce activity through any type of electronic mode should have to take a Registration Number from the DPIIT.

CAIT declared that traders across the Country will observe forthcoming week beginning 14th June to 21st June as ” E-Commerce Purification Week” under which thousands of trade associations of the Country , on forthcoming 16th June, will handover a memorandum in the name of Prime Minister Narendra Modi to their respective District Collectors urging the Union Government to take immediate steps to stop continued violations of the policy and the rules by Amazon, Flipkart and other similar foreign funded e-commerce companies.

The traders delegation will meet Chief Minister and Finance Minister of their respective State and will call upon that small traders must not face any backlash from e-commerce companies. The trade associations across the Country will send memorandums to Prime Minister Narendra Modi and Union Commerce Minister Piyush Goyal to protect the business community from the onslaught of e-commerce companies.

CAIT said these e-commerce companies have left no stone unturned in passing deaf ears to the repeated statements made by Goyal several times and have indulged in unethical & illegal activities by flouting the mandatory provisions of the FDI Policy in both letter & spirit. This fact has been corroborated by Delhi High Court in January 2021 in the matter of Amazon v/s Future Retail that Amazon is indulging into mal-practices and yesterday when Karnataka High Court stated in its order that “It is expected that an order directing investigation be supported by ‘some reasoning’, which the commission has fulfilled”. This observation of the Court has substantiated the fact that everything is not going well and therefore, the investigation should continue. Both the trade leaders complimented CCI for arguing the case well and stood firmly with its observations and actions.

CAIT said that the misunderstanding of the e-commerce Companies that India’s laws are weak and can be manipulated either way as per the convenience must be washed away with immediate credible actions.

Traders across the country have been taken on a ride by these companies and slowly and gradually are losing the confidence in the administrative system and to regain such confidence, strict steps are needed to ensure that whosoever, small or big, should not even think of violating the law or the policy.

CAIT said inspite of these daylight blatant violations, so far the officials and the Departments concerned have not taken any significant step to curb the mal-practices of these e-commerce companies. It is requested that stern directions may be issued to the concerned officials to take immediate steps to maintain an even level playing field as elaborated by you number of times-said the trade leaders.

CAIT said that the game of capital dumping by these so called marketplaces has dumped the entrepreneurial skills and human capital of the country which is a cognizable offence. Making the human capital of any Country to sit idle, displacing them from their businesses and encroaching upon their livelihood by these capital behemoths is certainly never the ” Bharat” which Prime Minister Narendra Modi has dreamed of. This policy is killing the “Atmnirbhar Bharat” spirit of the people of India.

“These companies are trying to establish themselves as the second edition of East India Company to fulfill their aspirations and ulterior motives to control & dominate not only the e-commerce but the entire landscape of the retail trade of India which is being run by more than 8 crore traders providing employment to nearly 40 crore people and generating an annual turnover of about Rs.115 lakh crores of rupees,” CAIT added.

The traders body added that both Amazon & Flipkart have claimed from time to time that they are the most law compliant bodies and if it is so then why they are afraid of any investigation into their business model and business practices and have tried their level best to stall the investigation ordered by the CCI.

“Let there be a thorough probe by the CCI and these Companies should emerge victorious amidst various complaints made against them from time to time. The CCI investigation into their business model is in fact a credible opportunity for them to become a role model for the trade and industry of India, as claimed by them that they are the real engine of growth of small businesses and also to establish that they are the saviors. All attempts to stall the investigation proceedings by Amazon & Flipkart certainly reinforce the allegations that these Companies are indulged in law violating business model to the thick and thin,” it added.

Amazon and Flipkart claim that they are the true marketplace for e-commerce activities in India and helping small traders to grow their businesses and in fact substantial numbers of small traders have grown big under their business model, as per their claims. Their claims sends a message that these companies are in fact charitable organizations and they took pity on vulnerable conditions of small businesses and therefore providing them bigger opportunities to grow their businesses under the pious and holy umbrella of these Companies and they are the only alternative in India for the small traders to grow, CAIT said.

“However, we are of the considered opinion that such claims are absolutely unfounded and have no legs to stand. If they are true to their version and claim, they should provide a list of only top 10 sellers on their portal in the last 5 years which will reveal the fact that names of the same set of sellers will exist during these 5 years as the top sellers which are prominently related to them in one way or the other thereby consolidating the sales into few hands only. These foreign e-commerce entities are habituated to make tall claims about helping and assisting small and medium retailers while ruthlessly destroying the very fabric of our traditional Kirana and small merchants,” the body said.

“The business community of India is self dependent and does not require mercy of any foreign entity. We are absolutely not orphan Childs as perceived by these Companies and are quite competent to ensure our growth within the parameters of the policies defined for the domestic trade of India by the Government and it is not a fallacy but an admitted fact that whatever turnover is generated by the domestic trade in India, is the proven result of hard labour that traders of India have put into their businesses and the level of CSR activities being conducted by the traders in India is much larger than any of the Corporate house including Amazon, Flipkart and others,” the body said.

Traders across the Country are in pain and anguish at a recent remark made by Amit Agarwal, Country Head, Amazon India, where he said that for India to be a global destination for investments, it must assert the validity of contracts and legal agreements.

“We have never come across a more paradoxical statement by an industry head because if there is one business group that needs to regard and follow the law of the land, it is Amazon India. It will be better for Mr. Aggarwal not to make mockery of the Indian legal system that Amazon is resorting to in addition to the wide-scale and ever-subsisting violations of the FEMA/FDI Policy, lockdown guidelines and other laws and better put absolute focus in complying the policy and the law spelled out in FDI policy of the Government,” CAIT said.

Business

Cyclicals to drive Q3FY22 earnings growth: MOFSLA

Published

on

By

graph

Corporate earnings growth for the third quarter of FY22 is expected to be led by cyclical stocks, Motilal Oswal Financial Services (MOSFL) said in a report.

Earnings growth is anticipated to be driven by metals, oil and gas and BFSI (Banking, Financial Services and Insurance) sectors.

In its report, MOSFL said that economic recovery backed by festive demand, higher commodity prices and improvement in asset quality in financials are expected to back this trend.

“There remains a clear divergence in 3QFY22 earnings growth. Global cyclicals, such as oil and gas and metals, continue to drive aggregate earnings growth, while BFSI profits are led by improvements in asset quality and credit growth,” the report said.

“Technology is likely to continue its momentum, propelled by strong revenue growth,” it added.

The auto and cement sectors are anticipated to drag earnings down, led by poor demand and higher commodity prices.

“Consumer, healthcare, capital goods, consumer durables and specialty chemicals are predicted to report single-digit YoY profit growth. Input cost pressures continue to weigh on gross margins for cement, specialty chemicals, autos, consumer staples and durables sectors,” the report said.

The report pointed out that Asian Paints, Bharti Airtel, BPCL, IOC, Tata Steel, JSW Steel, Titan, Hindalco and ONGC have seen an upgrade in their FY22 earnings.

“Companies that have seen downgrades to their FY22E earnings are Tata Motors, Maruti Suzuki, Ultratech Cement, Hero Motors, Shree Cement, Coal India, Axis Bank and HUL,” it said.

Continue Reading

Business

HDFC Bank’s Q3FY22 YoY net profit up 18.1%

Published

on

By

 Lending major HDFC Bank on Saturday reported a year-on-year rise in net profit of 18.1 per cent for the third quarter of FY22.

The bank’s net profit increased to Rs 10,342.2 crore during the period under review over the quarter ended December 31, 2020.

Besides, the bank’s net interest income (income earned less interest expended) for the quarter under review grew by 13 per cent to Rs 18,443.5 crore from Rs 16,317.6 crore for the quarter ended December 31, 2020.

The lender’s net revenues (net interest income plus other income) increased by 12.1 per cent to Rs 26,627 crore from Rs 23,760.8 crore for the quarter ended December 31, 2020.

“Advances grew at 16.5 per cent, reaching new heights driven by relationship management, digital offering and breadth of products. Core net interest margin was at 4.1 per cent. New liability relationships added during the quarter remained at an all-time high,” HDFC Bank said in a statement.

“This continued focus on deposits helped in the maintenance of a healthy liquidity coverage ratio at 123 per cent, well above the regulatory requirement, which positions the bank favourably to capitalise on growth opportunities,” it added.

As per Q3FY22 results, provisions and contingencies for the quarter rose Rs 2,994 crore (consisting of specific loan loss provisions of Rs 1,820.6 crore and general and other provisions of Rs 1,173.4 crore) as against total provisions of Rs 3,414.1 crore for the quarter ended December 31, 2020.

“Total provisions for the current quarter included contingent provisions of approximately Rs 900 crore,” it said.

“The total credit cost ratio was at 0.94 per cent, as compared to 1.30 per cent for the quarter ending September 30, 2021 and 1.25 per cent for the quarter ending December 31, 2020,” it added.

Continue Reading

Business

Lenders expected to exhibit strong Q3FY22 results

Published

on

By

 Listed lenders in India’s equity markets are expected to report ‘optically’ strong earnings growth for Q3FY22, said HDFC Securities in a report.

Accordingly, the brokerage house expects its coverage universe of 23 lenders to report 51 per cent YoY growth during the period under review.

This trend, the report said will come largely on the back of expected normalisation of provisions.

“The pace of collections and recoveries continues to improve, which, concurrent with normalised economic activity, is likely to moderate the stressed pool,” the report said.

“Disbursements are likely to witness healthy growth, driven by seasonal pick-up in retail loans as large corporate Capex remains elusive.”

As per the report, the revival in business momentum is likely to drive a 10.4 per cent YoY loan growth for the brokerage house’s coverage universe, with large private banks and large NBFCs (BAF) continuing to clock market share gains.

“The third wave of the pandemic is unlikely to impact Q3 earnings except in underlying sectors like travel and tourism that are already under stress.”

“However, we expect most lenders to maintain a surplus provisioning buffer for potential asset quality issues. We tweak our FY22E-FY24E forecasts for select lenders to factor in lower credit growth and marginally higher credit costs.”

Besides, HDFC Securities continue to prefer large banks with strong balance sheets and formidable deposit franchises.

Furthermore, it cited that business momentum continues to gather pace.

“In a quarter relatively unaffected by the pandemic and near-normal resumption of economic activity, we expect to see strong sequential growth in disbursements, particularly in retail and SME segments, riding on seasonal and pent- up demand.”

“Provisional filings suggest that banks within our coverage universe continue to gain market share as reflected in loan growth at 12 per cent YoY compared to system-wide YoY credit growth at 7 per cent.”

At present, the brokerage house has 23 lenders in its coverage universe including ICICI Bank, SBI, Bajaj Finance, SBI Cards, and Axis Bank.

Continue Reading

Trending