MUMBAI | TUESDAY, 12 JULY 2016 TAKE TWO 19. <

NIVEDITA MOOKERJINew Delhi, 11 July

Consolidation was projected to bethehighlight for the Indian e-com-merce industry in 2016, and the

first big one is being scripted as the yearcrosses the mid-mark. Four-year-oldGurgaon-based fashion and lifestyleportal Jabongmay be acquired in a dealvalued at around $250million, estimatessuggest.

If the deal takes off, it will inevitablybe compared to the othermajor acquisi-tion in the fashion universe — SachinBansal and Binny Bansal-led Flipkart’sbuyout of Mukesh Bansal’s Myntra for$300 million in May 2014. (None of theBansals are related to each other.)

While Mukesh Bansal left the organ-isation earlier this year to start out onhisown yet again, the Myntra effect hasbeen positive on Flipkart as fashion is afast growing online category with mar-gins in the segment much higher thanmost other items, point out experts.

Also, Myntra’s buyout by Flipkartprompted others to shop for fashion aswell. Kunal Bahl-led Snapdeal acquiredExclusively.in, a high-end luxury fashionportal, last year for anundisclosed value.Thatwasn’t enough. The talk now is thatSnapdeal wants to buy Jabong, the realchallenger toMyntra, to grow its fashionbusiness. Even Vijay Shekhar Sharma-promoted Paytm’smarketplace businessis focused on the fashion category, andso is Shopclues.

The possible Jabong M&A deal ismaking news when investors havealmost closed their purse-strings andfund-raising by e-commerce players is ararity unlike a year ago. Not surprising-ly then, buyouts have been subdued inan industry that’s pegged to grow to $100billion by 2020.

Although Jabong has dismissed thenews as speculation, the e-commerceworld is abuzz that the German incuba-tor Rocket Internet-backed fashion por-tal has a long list of suitors—Snapdeal,Myntra, Aditya Birla group’s Abof,Future andAlibaba. It is learnt that bothRocket Internet and Swedish investmentfirmABKinnevik, which have a consid-

erable holding in Jabong’s parent, GlobalFashion Group, want to sell their stake.

OntheblockonandoffThat said, this is not the first timeJabonghas been on the block. Last September,there was similar talk of a buyout. WhileSnapdeal seems to be the frontrunnernow, its name had emerged as one of thehopefuls last year aswell. KunalBahl, co-founder and CEO of Snapdeal, had thensaid, “Anytime anyone wants to look atraising money in this market or thinkabout getting a strategic partner on-board, they come and talk to us.’’ Thistime around, reports have indicated thatterm sheets have been readied for a dealbetween Snapdeal and Jabong.

But as is the case for all deals, it is notdone till it is announced. Soon after thebuzz on Jabong being on the block lastyear, themanagement held back to back

interviewsat a centralDelhihotel to “giveout the correct perspective’’.

In one such interview with BusinessStandard inOctober,Nils Chrestin, thenacting CEO of Jabong, said the companywasgetting ready for amakeover and thata new leadership teamwould be in placein the next two-three weeks. Jabongseemed in a hurry for the makeoverbecause by the same evening, it hadannounced appointments of a new chiefmarketing officer, chief product officerand chief technology officer.

Chrestin, who’s also the chief finan-cial officer at London-based GlobalFashionGroup, which runs Jabong, saidthat by 2020, fashion would constitute40 per cent of the estimated $100 billione-commercemarket in India andJabongwould be at the forefront in the segment.Would thatmean Jabongwould still be apart of GFG, which operates in 28 geog-

raphies around the world, in 2020?Chrestin had replied, “Who knows whatcould happen in five or 10 years?” But hehad added India has the potential to be along-termdestination for Jabong’sparentcompany, GFG.

While reports had said that Jabongcouldnot be sold last year becauseof val-uationmismatch (asking price was $500million and there weren’t any takers atthat value), Chrestin’s reply had keptthings open-ended.

Meanwhile, thingshavebeen ina flux.Last year, Jabongwas brought under theGFG fold, alongwithother fashione-tail-ers fromLatinAmerica,Russia,Australia,WestAsia andothers. Subsequently, sev-eral co-founders, includingPraveenSinhaand Arun Chandra Mohan, left the com-pany. Reports suggest that the currentCEOSanjeevMohanty,whowas appoint-ed last year, is on his way out too. He is

likely to join Levi’s as India head.

AgrowthstoryIn themidst of all the changes anduncer-tainties,what ismakingJabongapotentialcandidate for acquisition is its financialturnaround. Jabong’s Ebitda (Earningsbefore income, taxation,depreciationandamortisation) losses, for the first sixmonths of 2015, had grown46per cent to~227.4 crore compared to ~55 crore a yearago,Chrestin told thisnewspaper lastyear.Hehad added that the focus in the futurewould be on profitability along withgrowth. And Jabong has walked the talk.

Jabongachievedbreakeven in the lastquarter andplans tobecomeprofitablebymid-2017. In the first quarter of this year,the company posted ~244 crore revenue,an increase of 14 per cent from last year.Its gross loss is down to ~46.7 crore in2015, from ~159.5 crore in 2014, as it

reduced discounts on the site.Jabong isnotalone inshifting focuson

profits. Myntra is targeting profits nextyear; others are actively pursuing prof-itability as well as investors are gettingimpatientwith losses.AsSnapdeal’sBahlin a recent interview to another publica-tionput it, “GMV(grossmerchandise val-ue) is so2015andprofitsare thewaytobe.”

Theshapeofthee-commercemarket isclearlyset forachange.Amazonispouringwhatever it takestobeawinneras itbattlesit outwithFlipkart in India. In addition toits $2billion investment in2014, it recent-ly announcedanother $3billion for India.Meanwhile, Chinese major Alibaba ispreparing to enter India for direct play ininternet-ledcommerce.EvenIndianbusi-nesshouses, includingtheAmbanis,TatasandBirlas, aregearingupforabigger sliceof the online pie, making everyone lookclosely at their financials.

Jabong’s makeover adds to its M&A appealThefashionportalcouldbecometheM&Ahighpointof2016asitswitchesfocustoprofit inthemidstofchangesanduncertaintiesfortheindustry

WHY JABONG ISA POTENTIALTARGET

Profit margin infashion is 10-15per cent against2-3 per cent inelectronics

Jabong’s losseswere down to~46.7 crore in 2015from ~159 crore in2014

All major e-tailerswant to be strongplayers in fashionto turn profitsquickly

Indian e-retailcould grow to $100billion (~6.7 lakhcrore) by 2020, withfashion playing astrong role

“Who knows what could happen in fiveor 10 years?India has the potential tobe a long-term destination forJabong’s parent company, GlobalFashion Group.”

NILS CHRESTINCFO, Global Fashion Group

TENDER CARE Commercial Feature

BPCL signs MOU for 2016 - 17 with MoP&NG

BPCL signed a Memorandum of Understanding (MoU) with MoP&NGfor the financial year 2016-17 at Delhi on 5th July, 2016.The MOU was

signed by Shri K.D. Tripathi Secretary, (Petroleum &Natural Gas) and ShriS. Varadarajan C&MD, BPCL in the presence of MoP&NG officials, SmtUrvashi Sadhwani Sr. Economic Advisor, Shri Anant Kumar Singh AddlSecretary and Financial Advisor, Shri Ashutosh Jindal Joint Secretary(Marketing & GP), Shri Sunjay Sudhir Joint Secretary (IC), Shri Amar Nath,Joint Secretary (Exploration), Shri Alok Chandra, Adviser (Finance), ShriAlok Tripathi, Dir(D&MC) along with Shri P Balasubramanian Dir(Finance)BPCL, Shri D Rajkumar MD BPRL, Shri V Anand ED (Planning &Infrastructure) and other BPCL officials.

New India awarded the Best General InsuranceCompany Award from Fintelekt

New India awarded the Best General Insurance Company Award, EBusiness Leadearship Award and Non Urban Business Growth Award

in Fintelekt India Insurance Awards 2016. Seen in Picture receiving theBest General Insurance Company Award on behalf of New India : Mr. G.Srinivasan, CMD, Mr. H.G. Rokade, Director & GM and Mrs. S.N. Rajeswari,FA & GM.

Federal Bank introduces Tax return e filing servicesFederal Bank has come out with a new initiative for its customers to e

file their income tax returns easily. For this, the Bank has launched anew portal service (http://www.federalbank.co.in/clear-tax). Customerscan login to this portal and upload their Form No.16. The portal will cap-ture details from Form No.16 and pre-populate it. Only a few remainingfields are to be filled in by the customer. The portal can also be used bycustomers who are not having Form No.16. Non Federal Bank customerscan also make use of this facility. Announcing this service, Shri Babu K A,Head – Digital Banking said “E filing service is yet another digital offer-ing from Federal Bank that enhances customer convenience. Customerscan now easily and confidently file their returns through this simple por-tal. Customers will find it highly useful as the portal will capture and pre-populate details available in Form No.16, ensuring accuracy and avoidingdata entry. We are happy to launch this service this month when mostpeople file their returns”.

CR Heritage Week ExhibitionShri G.C.Agrawal, General Manager, Central & Western Railway opened

an exhibition as a part of CST heritage week celebrations observedfrom 2.7.2016 to 8.7.2016. The weeklong exhibition contains copy ofrare original drawings of CST building by F.W. Stevens, maps of oldMumbai and architectural facets of the building. The exhibition is openbetween platform no.7&8 at Chhatrapati Shivaji Terminus Mumbai, from10 am to 6 pm during the heritage week and is free for all.

Shri G.C. Agrawal, General Manager, CR & WR, Shri A.K. Srivastava,Additional General Manager, Shri Amitabh Ojha, Divisional Railway

Manager, Shri Vinit Kumar, Secretary to GM, Shri Narendra A Patil, ChiefPublic Relations Officer, Shri Sunil Udasi, Deputy Chief Personnel Officer(HRD), Shri V. Chandrasekar, PRO and Shri Vikas Dilawari, ConservationArchitect at the exhibition.

BHEL bags PSE Excellence Awards

Bharat Heavy Electricals Limited (BHEL) has been conferred PSEExcellence Awards 2015 for Human Resource Management Excellence

and for R&D, Technology Development & Innovation, in the Maharatna &Navratna CPSEs Category by the Indian Chamber of Commerce (ICC). Theawards were received by Mr. D. Bandyopadhyay, Director (HR), BHEL.

Plantation drive at NINL during VanamahotsavaNeelachal Ispat

N i g a mLimited, based atK a l i n g a n a g a rI n d u s t r i a lComplex inOdisha, observedVanamahotsava -2016 from 1stJuly to 7th July,2016 by massiveplantation drive.Shri G.S. Gill, MD,NINL kick startedthe programmeby plantingsaplings at the

EMC department and Compressor House on 1st July 2016. Shri S.Mohanty, GM (Finance), Shri V.M. Singh, DGM (Environment) were alsopresent on the occasion along with other officials. The Horticulturedepartment organized the celebration of the week-long Vanamahotsavaby plantation of 2000 saplings inside the plant with tree species likemango, jack fruit, badam, arjun etc. The company has also planned forplantation of 7000 saplings this financial year.

PUBLICNOTICENotice is hereby given thatmy clients 1)MR.RAJESH RATILAL DAGLI & 2) MRS.VEENA RAJESH DAGLI, Owners of theproperty more particularly described in theSchedule hereunderwrittenpurchased fromMR. DINESHMUKUNDRAI DAVE underAgreement dated 24thApril, 1994have lost/misplaced OriginalAgreement dated 11thDecember, 1980 made between M/s. K.PATEL&CO. PVT. LTD. andMR.DINESHMUKUNDRAI DAVE in respect of theScheduledProperty.Any persons having any claim, right, title,interest, benefit, etc. in respect of the abovesaidOriginal Agreement and/or ScheduledProperty or anypart thereof asandbywayofownership or mortgage or charge or lien ortenancy or otherwise howsoever in respectof the above are hereby required to giveintimation thereof along with documentaryevidence in support thereof within 14(fourteen) days from the date of publicationhereof toMR.R. J. CHOTHANI, Advocate,A-104, 1st Floor, Ambica Darshan, C.P.Road, Near Bus Depot, Kandivali (East),Mumbai 400 101.In default, all such claimsshall bedeemed tohavebeenwaivedandmyclientswill proceedon the basis of the title of the ScheduledProperty as marketable and free from allencumbrances.SCHEDULE OF THE PROPERTY

Flat No.H-401 admeasuring 535 sq. ft.Built up area on 4th Floor in the BuildingknownasPatelNagarCo-operativeHousingSociety Ltd. situated at Mahatma GandhiCrossRoadNo.4,Kandivali (West),Mumbai400 067, constructed on all that piece orparcel of land bearing C.T.S. No.1084 ofVillage : Kandivali, Taluka : Borivali, M.S.D.Place : MumbaiDate : 11.07.2016

Sd/-(R.J. CHOTHANI)

Advocate