Business News at 09:30 am on 31st March 2023

Reliance Industries has initiated the process to demerge its financial services business into Reliance Strategic Investments and rechristen it Jio Financial Services. The company convened a meeting of creditors and shareholders on May 2 to seek their approvals, under the National Company Law Tribunal’s (Mumbai bench) March 27 order, for the spin-off. The voting will commence on April 27 and end on May 1, RIL said in a regulatory update. According to the contours of the deal, RIL will issue one share of the demerged company with a value of Rs 10 each for every share held in RIL. The appointed date for the demerger is March 31, 2023. Upon the scheme becoming effective, the name of the demerged firm will be changed to JFSL and the new firm will be listed on the Indian bourses. KV Kamath, former MD and CEO of ICICI Bank was named non-executive chairman of JFS.

Moving on. Edtech startup Unacademy has announced a fresh round of layoffs, which could affect as much as 20% of its total workforce, sources close to the development told FE. This will be the company’s fourth round of workforce rationalisation in the last 12 months. In an internal email to employees, Unacademy CEO and co-founder Gaurav Munjal said that 12% of the total employees, totalling 380, will be hit by the current layoffs. “I never thought I would need to send out another message like this, but here I am. We have taken every step in the right direction to make our core business profitable, yet it’s not enough…Unfortunately, this has led me to take another difficult decision. We will be reducing the size of our team by 12% to ensure we can meet the goals we are chasing in the current realities we face,” Munjal wrote in the email accessed by the Financial Express. With the latest round of layoffs, at least 1,200 of its employees stand affected, including the 150 employees in June and the 600 workers the company fired in April.

Now some latest economic news. The Foreign Trade Policy to be announced on Friday, amid a slump in global demand and sustained contraction in the export of goods, will likely give thrust to more coordinated government support to boost exports and refrain from rolling out any new incentive schemes. While tax remission for exported goods will be an inalienable right of exporters, the new policy could feature several facilitation programmes to make it easier for firms to export. Relaxation of procedures and paperwork, especially in seeking permits and licence renewals, removal of human interface and bolstering of automation on various aspects of the trade is on the cards. The annual export target of $2 trillion by 2030 will be reiterated.

In another key economic update, exports of agricultural and processed food products rose by 9% to $ 23.1 billion during the first 11 months of the current fiscal (2022-23) compared to the same period last year, driven by shipments of rice, fruits, and vegetables, livestock and dairy products. According to the Directorate General of Commercial Intelligence and Statistics, rice exports from April-February (2022-23) rose by more than 16% on year to a record $ 10 billion from $ 8.6 billion in the previous year. In September, India imposed a ban on broken rice exports and put a 20% export tariff on the non-basmati and non-parboiled rice, a measure aimed at improving domestic supplies, because of expectation of a decline in production in the 2022-23 crop season (July-June).

In other news, Russia’s biggest oil producer Rosneft Oil Company has signed a term agreement with state-run Indian Oil to increase oil supplies and diversify grades. “The parties also discussed ways of expanding integrated cooperation between Rosneft Oil Company and Indian companies in the entire value chain of the energy sector, including possibilities of making payments in national currencies,” Roneft said in a statement. The development is in sync with the increased purchases of Russian oil by India since the Russia-Ukraine war broke out, which led to many reduced exports of oil to conventional western buyers.

With the 16th edition of the Indian Premier League to be streamed live on Viacom 18’s OTT platform JioCinema from today, it could be a slow pitch for television ad rates. Viacom 18 acquired the digital rights of the tournament for Rs 23,758 crore for the 2023-27 period. JioCinema will be live-streaming the game free of cost in a dozen languages and is believed to have bagged ad deals for up to Rs 1,000 crore. Star Sports is selling ad spots at Rs 15-16 lakh per 10 seconds, while the rates on connected TV are Rs 6-6.5 lakh per 10 seconds.