what started as a startup is now a functioning bank bindiya a.kirtane resid-ing at g-4, b- wing...
TRANSCRIPT
16�THE ECONOMIC TIMES | MUMBAI | FRIDAY | 31 MARCH 2017Economy: Macro, Micro & More
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I, Bindiya A.Kirtane resid-ing at G-4, B- Wing NarmadaSmurti Bhayander EastThane has changed name(Bindia) to Bindiya A. Kirt-ane affidavit on 22.03.2017 atBorivli Court.
I, Anshuma W/o NaveenKumar Goel have changed myname to Anshuma Goel videan Affidavit no RM959343sworn before notary Ravindranath R Shetty dated24th Jan 2017.
The New Development Bank, or BRICS Bank as
it is popularly called, is in its second year of
operation. The bank’s board is meeting in Delhi
over the weekend. Veteran banker KV Kamath,
who heads the bank, spoke to Vinay Pandey on
the progress made by the new bank and how
he sees the Indian economy. Edited excerpts:
When the BRICS Bank was announced, the
narrative was that this was being promoted
as an alternative to the existing multilateral
set up. How has that narrative played out?
It is an initiative that the BRICS nations took,
which to me in a larger context was five count-
ries from the south that were traversing
through the development paradigm came
together and said we will try to build an in-
stitution on our own. To properly reflect its
context, they gave the name the New Develop-
ment Bank. One year down the road, I think the
objectives that we had started off with, we are
on the road to meeting them. We need to build
the strength at the ground level. Strength has
now been built. Then you need to build ex-
ecution capability. We have built that. What
was a startup is now a functioning bank.
In terms of lending what kind of ambition
does the bank have?
Our focus basically is around the infrastructure
space, sustainability and green being a key. In
the first year, the focus was on green energy
and slowly expanding it to other areas of
sustainable activity. We will stay within this
core set of activities. We did about a billion-and-
half in US dollar in lending in the first year. Our
target is to do between two-and-half and three
billion this year and scale up the human capaci-
ty, and at the same time the lending capacity of
the bank for this year and year forward.
Are you happy with the pace of the New
Development Bank?
As a bank I can say that we could not have
operated at a faster pace. There are certain
fundamental structures in a bank which you
need to have in place and we had to have those
in place before we could have grown.
You have raised local currency funds in
China and now you are looking to raise
rupee funds. Is that going to be the broader
strategy?
In the last one and half years we have found
that local currency funding is becoming the
flavour of the days as it were for a very simple
reason that tremendous volatility has been
seen in the global currency market place.
Countries find it is best to stay near to what they
can manage, which is local currency risk. So,
there is demand. Of course, we have to make
sure that pricing is right. India becomes a
natural next step for local currency because
there is a very large local currency market and
very interestingly there is a masala bond
market also. Our route will have to be necessari-
ly through the masala bond market.
How do you see the Indian economy post
demonetisation?
I would think that the demonetisation
exercise clearly was a success. The timeli-
nes that were articulated to get the
remonetisation in place have been met.
The impact of demonetisation in terms of
sucking out the black money in the
system, the first part is done. We will now
have to see the implications in terms of the
tax collections through this.
Has the economy bounced back quicker
than it was expected from demonetisation?
What could have slowed it down is curtailment
of say first level working capital, second level
ability of the consumer to buy the product due to
avariety of reason – he doesn’t have the liquid
cash and so on. I would think the two-month
process gave enough lead to correct
these things, so I would presume it
hasbounced back healthier.
One of the big worries has been
nonperforming assets.
The idea of a bad bank
has also come back on the table. What is
your view?
There are two problems here. One is putting the
asset back to use and the second getting the
banking system to a healthy state. Putting
assets to use can be done in two ways. Resolve
it within the bank or take it into bad bank.
Recapitalisation need in either case will rema-
in, that’s the hit the banks will have to take. A
bad bank doesn’t automatically resolve pro-
blems. A bad bank requires funding. So, the
first question we will have to answer if we talk
of bad bank who is going to fund this. I don’t see
the money. The resolution exercise has to be
within the bank, otherwise we are wasting
time. The government has to drive this resolu-
tion exercise, which is happening. Yes, there
could be issues of what we call moral hazard.
We will have to look at it as we go along.
How do you see the BJP’s recent election
victory in UP, which has raised expectations
of a faster pace of reforms? GST bills have
already been passed.
As I see it, any government’s ability to pass
what it needs for a reforms process and its
ability to push that through, I think is a big plus
to an economy. Probably, this victory will give
the government the momentum required to get
a whole lot of things done.
What would be in your view the key
reforms that need to be done going ahead?
The key growth engine for this country at our
stage of development is going to be infrastruc-
ture, infrastructure coupled with retail side of
the economy will be a key driver. Actions taken
on the agriculture side again will sustain whole
lot of activity in the country.
How would you assess these three years of
the government and how do you see things
going ahead?
Three years were trying to get the economy
re-spinning at pace and I would think that part
of it is done. Now the opportunity is to drive it
at even a faster pace. That should happen
starting from now onwards though the slight
challenge is going to be weakness in some parts
of the private sector, some parts of the banking
sector. Urgency to fix these quickly and set a
tight timeline, I think then the economy should
be firing on all cylinders.
We hear lot of noise in terms of social
tensions, Hindutva, etc. Is this just here or
globally too it is noticed?
I don’t hear the noise where I am, in this con-
text. It doesn’t get reflected globally. Where I
sit, India is still looked at as the brightest spot
among comity of large economies.
If you were to pin down what is it that
makes India a bright spot, what would you
say?
What I find now is the large infrastructure gap
in the country which can be very productively
filled. The act of filling it itself will generate
economic development. And, the fruits of this
investment will bear returns for next twenty-
thirty years. I think this is the most exciting
thing to me about India. It’s a vast country with
vast opportunities, vast gaps and the ability to
fill those gaps.
What Started as a Startup is Now a Functioning Bank
KV KAMATH
ON LENDING TARGETS
Our focus is around the infrastructure space, sustainabilityand green being a key. We did about a billion-and- a-half in US dollar in lending in the first year. Our target is to do between two-and-a-half & three billion this year
PRESIDENT, NEW DEVELOPMENT BANK
Q&A
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When contacted, Ascent CapitalCEO Raja Kumar confirmed the exitand the plans for a new fund, but decli-ned to comment on the specifics.
The new fund for Ascent Capital,which was earlier known as UTIVentures, comes about eight yearsafter it raised the previous fund of$350 million in 2009. It will also be itsfirst fund after it completely boughtout the stake held by UTI Asset Ma-nagement Company (UTI AMC),which was one of the top mutualfund managers in the country, ow-ned by public sector financial insti-
tutions like StateBank of India andLife Insurance Cor-poration of India.
Founded in 2001 asUTI Ventures, thefirm’s managementteam led by Kumarstarted the spin-off
process in 2009 by rebranding it asAscent Capital.
The mid-market focused PE firm in-vests $10-30 million for minority sta-kes in companies in sectors like tech-nology, ecommerce, healthcare, finan-cial services, consumer brands andinfrastructure. Its investments inclu-de medical device company Skanray,packaged foods company Maiyas Be-verages and Foods, and credit ratingfirm CARE. Private equity and ventu-re capital together raised $4.9 billionin 2016 across 33 India-dedicatedfunds, compared with $4.5 billion theprevious year, according to data provi-der Venture Intelligence.
Ascent Scouts for $400-mCapital for the Next FundNew fund, expected to close by year end, to take total assets under management of co to over $1b
6 �THE ECONOMIC TIMES | MUMBAI | FRIDAY | 31 MARCH 2017Disruption: Startups & Tech
Bengaluru: Zensar said it wouldbuy Keystone Logic for about `̀132crore as it looks to build its digitalcommerce capabilities. The ITfirm’s chairman said more acqui-sitions were on the horizon.
Keystone Logic has about 210 con-sultants and helps companies withtheir warehouse and order mana-gement implementations.
It reported a revenue of about ̀̀ 83crore in FY16.
“Keystone Logic helps us roundout our offerings in digital com-merce, which is a fast growing areafor us. Overall, digital technologi-es contribute to over 30% of our re-venue. And we see scope to increa-se that further. Our buyout effortswill continue,” Harsh Goenka,chairman of Zensar and RPG Gro-up, told ET.
In November, Zensar bought UK’suser design company Foolproof. In
2014, it bought ecommerce techno-logy firm Professional Access.
Keystone Logic will continue tobe managed by its founder andCEO Ravi Joshi. Keystone’s mana-gement team and all their associa-tes based in Atlanta and Bengaluruwill become a part of Zensar’s Glo-bal Digital Commerce Services bu-siness unit.
The acquisition will be fundedthrough internal accruals and willadd to earnings, Zensar said in astatement.
The acquisition is expected to clo-se in the first week of April.
Goenka also said Zensar would fo-cus on using its cash pile to boostgrowth. Over the last few months,large Indian IT service providershave started announcing share bu-ybacks. Cognizant and TCS haveboth announced multi-billion dol-lar buyback programmes. HCLTechnologies said it would buyback ̀̀ 3,500 crore worth of shares.
Meanwhile, Infosys is asking sha-reholders to vote on an amendment
to its articles of association to al-low it to buyback shares.
“These buybacks that you are see-ing are from larger companies thathave a lot of cash and do not knowwhat to do with it. For mid-tierfirms, we are still looking for acqu-isitions, so I don’t think there aretoo many expectations of buy-backs,” Goenka said.
Earlier this month, mid-sized pla-yer Mindtree said its board had setup a committee to evaluate a poten-tial buyback.
Zensar Finds the Logic in KeystoneBuy to Build Its Digital Comm Base
New Building BlocksKeystone buy to be funded via internal accruals & will add to Zensar earnings
Keystone team to join Zensar’s Digital Com-merce busi-ness unit
Helps cos with their warehouse and order management imple-mentations
November 2016UK’s user design company Foolproof
2014Ecommerce tech firm Pro-fessional Access
210No. of consultants
`83crCo’s FY16 revenue
KEYSTONE LOGIC ZENSAR’S EARLIER BUY
ar,” said the official.The government on its part said
that it is evaluating the need forsuch a service since call volumeshave dropped drastically after theinitial surge. An official at the mi-nistry of electronics and IT toldET: “Since the National PaymentsCorporation of India (NPCI) ishandling all the retail payments, itis up to it to decide whether it requ-ires such a helpline. We have writ-ten to NPCI and it will take a finalcall on this,” said the official.
While NPCI could not be immedi-
ately reached for a comment onthis report, TCS, Tech Mahindra,Genpact, Intelenet Global Servi-ces, and Aegis did not respond to e-mail queries sent by ET.
According to Nasscom, there areabout 150 agents who have been in-volved in the pro-bono stage, andtheir future is also uncertain. “Af-ter the end of this pro-bono period,they would either be absorbed intothe commercial phase, if applicab-le, or into other projects at the re-spective BPM partners, subject toavailability of projects,” said Roy.
There is also some confusion per-taining to the end date of the freeservice. While some operators areplanning to down the shutters onthe service by March-end, some ha-ve put a deadline of April 15.
Note Ban HelplineWaits for Call fromGovt for a Lifeline
Making the Right CallCOS IN CASH-MUKT BHARAT ABHIYAN
BPOs - TCS, Tata Business Support Services, Tech Mahi-ndra, Genpact, Intelenet Global Services and Aegis
Telecom majors - Voda-fone and Tata Teleservices supply phone-line capacity for the helpline
OFFICIAL SOURCE
The reason for that (low call volumes now) is lack of publicity. If the government decides to promote it well, have stable operations with a commercial model, it can turn out to be a good initiative
Consultancy – Deloitte helps
man-age theservice
New Delhi: India’s drive to a less-cash economy seems to have exclu-ded a major initiative — the Cash-Mukt Bharat Abhiyan helplinerun by the best in the service busi-ness. The fate of the helpline num-ber ‘14444’, that started to answerqueries on digital payments afterthe November 8 demonetisation, isuncertain from the midnight ofMarch 31. It was put together morethan three months ago by Nasscomon the suggestion of the govern-ment, and is being run, for free, bysix bulge-bracket business processoutsourcing (BPO) companies thatinclude Genpact and Tata Consul-tancy Services (TCS), two telecommajors, and one large consultancy.
After the free run ends on March31, the companies are planning toshut down the helpline as the go-vernment has not said whether itplans to convert it into a commerci-al service. The initiative was uni-que in which the IT industry, per-haps for the first time, came to-gether and provided supportto the government withoutany commercial considera-tion.
Prasanto Roy, head ofNasscom’s InternetCouncil that coor-dinated the helpli-ne, said that it hasreceived over 3 millioncalls, with agents ans-wering nearly 300,000calls. “We have also sub-mitted a commercialproposal for the hel-pline, and are awai-ting a response fromNITI Aayog and the ministry ofelectronics and IT.”
He added that Nasscom’s charteralong with the Payment Council ofIndia (PCI) was to execute this probono and to submit a commercialproposal for the helpline. “Youmay wish to check with them fortheir further plans. We are unableto give further details of the propo-sal at this stage,” he said. The deci-sion on continuing the helpline asa commercial activity will be takenby the government.
The helpline’s aim is to aid in un-derstanding various digital pay-ment systems, such as wallets andnetbanking, besides new methodssuch as BHIM, USSD, Aadhaar Pay,and the newly launched QR Code.A lot of people are also calling‘14444’, launched on December 15,for grievance redressal on specificdigital payment platforms.
An industry executive said thecommercial proposal submittedby Nasscom was modelled on theother successful call centre opera-tions run by other governmentagencies, such as Aadhaar and In-come Tax. “If the government de-cides to continue the helpline, itwould cost less than ̀̀ 40 crore a ye-
Hyderabad: Online furnituremarketplace Urban Ladder is loo-king at a strong offline push, mul-tiple partnerships, and deeperengagement with customers inthe coming months, but says itcan scale up significantly only af-ter getting a licence to function asa single-brand retailer.
“This licence is critical to oursurvival,” said Ashish Goel, chiefexecutive at the Bengaluru-basedfirm that sought approval of thedepartment of industrial policyand promotion (DIPP) to underta-ke single-brand retail trading inSeptember last year. “Without thesingle-brand-retail approval, ourhands are tied… We will not be ab-le to go all out and build the busi-ness,” said Goel, who in the pasthas spoken about competing withSwedish furniture maker Ikea.
A single-brand licence would al-low Urban Ladder to stock pro-ducts and sell them directly toconsumers, eliminating middle-men and procuring directly frommanufacturers.
At present, as a marketplace, itcannot function as a retailer and
can only provide a platform forothers to sell their produce.
Urban Ladder is already ma-king an offline push with storesexpected to come up in Bengalu-ru, Delhi and Hyderabad.
“We are trying to give customersan additional trust factor thro-
ugh the presence of an offline sto-re,” said Goel. “The offline storethat comes up will contribute anadditional 20-25% to the Bengalu-ru revenue,” he said.
The company is also looking atpartnerships in multiple verti-cals, including one with the clas-sifieds advertising platform Qu-ikr in the coming months. It hadrecently announced a partners-hip with Tata Housing.
Goel said Urban Ladder aims tobecome a part ofthe customer’s li-festyle by provi-ding multiple of-fers like exchang-es, buybacks, andaccess to credit,among others.
“If you look atcompanies aro-und the worldwho have done anincredible job of
creating great brands, the onlyway they have done that is by be-ing deeply engaged with custo-mers,” he said.
Goel, who founded Urban Lad-der along with Rajiv Srivatsa in2012, is confident that the firmwill be profitable by 2018-19.
This Furniture Startup Needsa Licence to Go up the Ladder
Building It UpCRUNCHBASE FINDINGS
$92 million - Equity financ-ing Urban Ladder has so far raised from investors
SOME INVESTORSSequoia Capi-tal, Kalaari Capital, SAIF Partners
Ashish Goel is confident that the firm will be profitable by 2018-19
GOEL, CEO, Urban Ladder
No great brand was built by simply giving a discount
Single-brand licence will let Urban Ladder stock products, sell them directly
Urban Ladderis alreadymaking anoffline pushwith storesexpected tocome up inBengaluru,Delhi andHyderabad
Bengaluru: Cab hailing firmUber has appointed FrancoisChadwick, global head of tax andaccounting, as an additional di-rector for India operations, accor-ding to documents filed by thecompany to the Ministry of Cor-porate Affairs.
The filings also indicate that Ka-ren Sammis Walker, global control-ler, has resigned from the positionof additional director, India opera-tions, citing personal and unavoi-dable circumstances.
During a meeting held on March24, the board of directors of thecompany passed the necessary bo-ard resolution confirming Chad-
Walker was appointed as an addi-tional director for Uber’s India ope-rations in November, 2014. ET didnot receive any response to an ema-il query to Uber enquiring aboutthe change in directors and Wal-ker’s resignation from the role ofadditional director.
The cab hailing firm is currentlyin a crisis, grappling with accusa-tions of a sexist work culture, besi-des a critical search for a chief ope-rating officer and an intellectualproperty lawsuit from Google’sAlphabet-owned Waymo. The com-pany, which launched operationsin India in August 2013, is operatio-nal in 29 cities across the country.
wick’s appointment and Walker’sresignation. Both Walker andChadwick are Uber executives ba-sed out of San Francisco.
Chadwick Gets Extra Charge in Uber IndiaNEW ROLE TO PLAY
Francois Chadwick (inpic), global head of taxand accounting, nowalso takes on the role ofadditional director forUber’s India operations
He comes in place of Karen Walker who resigned earlier as additional director for India operations
For comprehensive and insightful stories about all things startups and technology, log on to www.ettech.com
a
At the end of the day, all Android OEMs ship the same OS, so they are really not that different. The sea of sameness is a death trap.
BEN BAJARIN@BENBAJARIN
Tweet OF THE DAY
Win Update will Bring 3D, Game Tools
A major update to Mi-crosoft’s Windows 10 system will offer 3-D drawing tools, game-broadcasting and better ways to manage your web browsing. This “Creators Update” also aims to make future up-dates less disruptive. Microsoft said that it will roll out the update to some 400 million Win-dows 10 devices world-wide. Though there’s no set schedule, devices that came with Windows 10 installed will likely get the update first. —AP
Facebook and Messen-ger apps will soon stop working on many smart-phones which run the older version. Facebook will end support for de-vices running older ver-sions of the apps, includ-ing v55 of the Facebook app and v10 of Messen-ger on Android. It will also stop support on Windows Phone. —IANS
Tech Buzz
Your FB App may Stop Working Soon
This job involves plan-ning, implementing and managing the sourcing, use and maintenance of data assets in a firm.
Data Steward
Jargon Buster
Pixel Perfect
A sculpture by artist Hajime Sorayama enti-tled ‘Sexy Robot’ on dis-play at the Universe and Art exhibition at ArtSci-ence museum in Singa-pore. —AFP
352 billionWorldwide mobile app downloads in 2021, according to App Annie
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THIS VIEW IS BETTER
$1 billion Assets under management of Ascent Capital after it closes this fund
EXITS OF ASCENT CAPITAL
Ascent Capital raised $350-million fund in 2009
$10-30 million Amount Ascent plans to invest in each startup
SECTORS: Technology, ecom-merce, healthcare, financial services, consumer brands and infrastructure
New Delhi: Private equity firmAscent Capital, an early investor inonline grocery retailer BigBasket, isplanning to raise a new fund of about$350-400 million (.̀2,275-2,600 crore) af-ter scoring half a dozen exits since lastyear. The new fund, which is targetingafinal close by the end of the year, willtake the total assets under manage-ment of the Bengaluru-based invest-ment firm to more than $1billion, twopeople familiar with the matter said.
While Ascent Capital has alreadystarted raising the fund and has be-en in a soft marketing mode sincelast year, a more active push cameafter it made an over threefold re-turn on investment while exitingmulti-speciality hospital chain Ke-rala Institute of Medical Sciences(KIMS). Earlier this week, TrueNorth invested $200 million inKIMS for a controlling stake, in oneof the largest private equity invest-ments in the healthcare space. Thetransaction also included acquisi-tion of the stake held by Ascent Ca-pital, which first invested in KIMSin late 2011 and infused capital inmultiple tranches.
Ascent also exited from RBLBank, which went for an IPO last ye-ar, besides payments company Cit-rus, which was acquired by PayUfor $130 million. It is now countingon this track record to successfullyclose the new fund.
New fund forAscent comesabout 8 yearsafter it raisedthe previousfund of $350 m in ’09
Globe Trotter
Telephone scammers are cold-
calling people, claiming that
iCloud, Apple’s cloud service,
has been hacked, and asking
them to give up their accounts
details. They seem to be exploit-
ing the recent headlines about a
group of hackers who claim to
have access to hundreds of
millions of iCloud user accounts.
In short: iCloud wasn’t hacked,
although bad password practic-
es mean many people’s ac-
counts are still vulnerable. — BI
Cold Calls oniCloud Breachis a New Scam
TH
INK
STO
CK
WAITING FOR A CLEAR SIGNAL