Reliance – Getting Ready For The Kill!

Things are warming up, and it is not just the temperature. The Reliance group has announced that the next sector it has set out to disrupt is e-commerce. Armed with the huge network of RJio and Reliance Retail, it shall tap the millions of mom-and-pop stores that dominate the Indian retail market and ensure that it has an obscene share of the USD 39 billion e-commerce market, poised for USD 200 billion by 2028. Obscene because this group does not believe in just dabbling in any business segment, it has to be do or die, where it emerges the dominant player, bordering to a monopoly.

How will this impact the trade fraternity, the brick-and-mortar retail outlets? In very small towns, there may be an overlap with the mom-and-pop stores. But what about the urban parts of the country that account for the major share of revenues? And here, a government policy change cannot be the saviour. Reliance is very much a home-grown brand. It is a worrisome situation indeed! (Was the Reliance group hands-in-glove with the government-imposed restrictions on the e-commerce global giants late last year, requiring them to cut cash-back payments and discounts- that is anybody’s guess.)

The DTH industry too is headed for disruption. Following the Videocon d2h merger with Dish TV, the merged company is headed for a buyout of promoter stake by Singtel-Bharti Airtel-Warburg Pincus consortium, with Airtel DTH to be hived off, and combined with Dish TV through reverse merger. This merged conglomerate and Tata Sky, with 30 percent owned by Walt Disney shall be the two major DTH players with an 88 percent combined share in the five-player industry. With the impending launch of Jio’s GigaFibre, the existing distribution platform operators too are bracing themselves for a shake-up in the market, as in response to the e-commerce policy change threat are OTT plaforms like Netflix, Hotstar, and Amazon Prime.

The airconditioner industry is excited with the promise of an extremely hot summer and no intermittent rains. After a couple of weak seasons and a 15-20 percent drop in prices, and capacity enhancement by some, the industry desperately needs this breather.

How much of a spoilsport the general elections will play is anybody’s guess!

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