India Bans Import of Cosmetics tested on Animals

Just five months after India prohibited the testing of cosmetics on animals, it Ministry of Health has issued new regulations banning the import of any cosmetics that have been tested on animals overseas.  Issued as an Extraordinary Announcement in the official Gazette of October 13, this rule (known as 135-B) comes into effect on November 13 this year. By contrast, China requires most cosmetics and personal care products to be animal tested prior to being sold.

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October 31, 2014   No Comments

Blue Chip Venture Capitalist Upbeat about India

Sequoia Capital‘s general partner, Douglas Leone is pleased with India. “We could not be more thrilled. We don’t have 25-30 category leaders in the United States; we don’t have (as many) in China right now, but we have it in India,” said Leone, whose fund has backed companies such as local search provider Justdial, restaurant listings service Zomato and data analytics firm Mu Sigma.

Interviewed in the Economic Times of India, the billionaire venture capitalist whose firm has backed Google, Apple, Tesla and Cisco said “We are seeing startup companies [in India]  growing just as fast as we’ve seen in the United States.” The fund expects to catch startups younger, pour more money into those already in the portfolio and sniff out the best deals in India’s booming consumer internet space. Sequoia has backed more than 100 companies in India and since 2011 it has invested $800 million in the country.

Leone said that Sequoia took a decision to stay away from online retail in India, a business that requires large amounts of capital and where profits are hard to come by. “We think it is a big top line space, but difficult to figure out when it is going to be a big bottom line space,” he said about India’s online retail sector. Domestic market leader Flipkart has raised $1.2 billion this year alone and Amazon’s Jeff Bezos has pledged to invest $2 billion in India.

India is the “next land of opportunity for entrepreneurship” and Sequoia is looking to make the most of it.

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October 29, 2014   No Comments

India Shines Among Emerging Country Consumer Markets

Consumer demand in emerging markets is getting affected because of weaker economic growth, in major markets such as Brazil and China.

But, according to Business Week, India could be a different story. “There are some things going in its favour. Economic growth seems to be recovering and inflation seems to be declining, particularly wholesale inflation. If the current trends continue, consumer demand should recover, especially in urban markets. Rural growth is subject to what happens to agricultural growth and may also get affected if the government actually cuts allocation to the rural employment guarantee scheme. Falling inflation is a big plus as it can improve profitability, or give companies leeway to spend more on advertising and promotions.
Therefore, India may resemble an oasis for consumer companies, relative to other emerging markets.”

The article goes on to say “Overall, Indian consumer companies seem to be in a better position because of the country’s improving macroeconomic prospects. While that is good for their earnings, it is also likely to keep investors interested in Indian consumer stocks. The BSE FMCG Index has gained 5.3% in the past three months and is trading at an expensive price-to-earnings multiple of 39 times. But that valuation may hold up if India can make good its promise of outperforming other emerging markets.”

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October 28, 2014   No Comments

Xiaomi to open its R&D and design facility

XiaomiXiaomi of Beijing China has identified Indian market as a potential place to grow its business. The company is now ready with a new strategy to set up an R&D center in India focused on local users, designing and customizing the devices according to them.

Hugo Barra, Vice President of the company said that Xiaomi had some issues and concerns in relation to the production of smartphones for Indian market because antenna calibrations and hardware are quite distinctive for the Indian market. So the stocks of other countries like Taiwan or China might not be redirected to India. Indian market is a potential and heterogeneous market with different requirements from network perspective.

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September 18, 2014   No Comments

Logistics in India costs less than in China

According to Economist article, logistics in India costs less than in China. Here are two examples that shows China as a mighty trading power, first is Yangshan which is in outskirts of Shanghai, is the world’s busiest container port and second is Pudong airport which is world’s third-biggest handler of air cargo. Also, there are 62000 miles of expressways  and comparable length of railways which stretches across the country. After all this infrastructure one might think china to have world class logistics industry. It does not.

Logistics spending in India is 13-14% of its GDP, whereas it is roughly around 18% for China. Li Keqiang, the prime minister, recently echoed industry’s complaints that sending goods from Shanghai to Beijing can cost more than sending them to America.

Logistics covers transportation, warehousing and the management of goods. Its Chinese translation, wu liu, literally means “the flow of things”. But that flow within the country is costly and cumbersome. Much of the investment in infrastructure has gone to lubricate exports. Now, as China’s government shifts its focus to consumption at home it is finding that the domestic logistics industry is woefully inefficient.

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September 10, 2014   No Comments