Brand licensing industry sees opportunity for growth in India

Aug 27, 2017 0

By Bappaditya Chatterjee

Mumbai– The brand licensing industry, now in its “nascent stage” in India, is set to grow manifold in the foreseeable future with rising brand consciousness among consumers and higher penetration of modern retail and e-commerce, industry experts said.

“The owners of intellectual properties (IPs), including major cartoon, entertainment and corporate brands, are keen to enter the Indian markets. Everybody wants to tap the 1.3 billion customer-base that the country has, especially when awareness of brands among consumers in 900 cities is very high,” License India Chairman Gaurav Marya told IANS on the sidelines of the recent India Licensing Expo 2017 held here.

He said international agencies that manage these assets (brands) are also looking at India as the “potential market”. The country’s potential licensees, who were “earlier not growing up enough to hire international brands” to push their sales, are now realising the need of brand power for improving their bottom lines.

“According to the latest Global Licensing Industry Survey, 2017, India currently ranks 20 with $1,396 million retail sale of licensed merchandise in 2016. The country’s rank in the global scenario is expected to improve as it has huge opportunity and there is global optimism for India,” Maura Regan, Executive President of the US-based International Licensing Industry Merchandisers’ Association (LIMA), told IANS on the sidelines of the expo.

She said India is expected, in the next 5 to 7 years, to be at the level where China is today in terms of retail sales of licensed merchandise and generating royalties.

According to LIMA’s Global Licensing Industry Survey, 2017, the market size is $262.9 billion with a 4.4 per cent growth over the previous year.

Brand licensing is basically renting the brand to an industry manufacturer or retailer. It is a legal process where a brand owner allows other businesses to use the brand for promoting their own products in the market.

In fact, foreign licensors have been seeing India as an advantageous destination over China because of its “positive cost benefit”.

John Erlandson, EVP Business Development and Co-Chief Business Officer, ABG (Authentic Brands Group), which owns and manages a portfolio of brands including “Elvis Presley”, “Muhammad Ali”, “Marilyn Monroe”, “Michael Jackson” (managed brand) and so on, told IANS: “India has a huge English-speaking population and they can go online and explain the brand story globally while many of the Chinese don’t have that skill-set. Thus marketing of the brands can be done much more rapidly.”

“Along with the Goods and Services Tax roll-out, organised retail and e-commerce are going to be the major enablers for the brand licensing industry,” Marya noted.

According to industry estimates, close to 95 per cent of the retail in India is still dominated by traditional and unorganised retailers, but organised retail, which is growing exponentially, is estimated to reach $220 billion by 2023.

“This is the space where international brands need to mark their presence. As many as 32 foreign brands forayed online and 22 global brands launched brick and mortar stores in 2016. Most of them are using brand licensing as a business model,” Marya said, adding that “about 460 foreign brands confirmed their entry in the consumer space either through licensing or franchise model”.

The experts said the licensing model in India has been thriving in categories like fashion, media and entertainment, sports and fitness, back-to-school and so on but is yet to pick up in the real estate, fast moving consumer goods (FMCG) and packaged foods sectors.

“The industry is still restricted to metro and major cities and a lot of growth opportunity is there. I foresee at least 15 per cent growth over the next five years as with the popularity of e-commerce, the tier II and III cities would come on the licensing industry map,” Viacom 18’s EVP and Business Head Saugato Bhowmik told IANS.

However, the flip side is the rampant presence of counterfeit products from unorganised retail segments, where manufacturers or retailers are selling products under the name of popular brands but without giving any royalties to the brand owners, the experts said.

Another challenge is that though home-grown IPs or brands are gaining in popularity in the country, they are “not able” to penetrate “the international markets in a bigger way”.

According to Marya, the owners of such home-grown brands were “limited to core functions and had not extended themselves”.

Home-grown brands like “Mahatma Gandhi”, “Bollywood” and others which have huge brand recall in the international market could do wonders overseas, he added. (IANS)

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Organic farming in India has huge potential, opportunities: Niti Ayog CEO

Aug 23, 2017 0

New Delhi–India has a huge potential for consumption of organic products and attempts should be made by progressive farmers to promote it, said NITI Ayog CEO Amitabh Kant on Wednesday.

“Some should become great organic farmers. India need couple of success stories. If farmers get better unit realisation value, many will emulate it. Sikkim has done outstanding work in the field of organic farming. I even found that Kiwi (fruit) from Arunachal Pradesh was of better quality than that in New Zealand,” he said in an event marked to release of a report on organic farming.

“As per the study conducted by the International Competence Centre for Organic Agriculture in eight cities in India, there is huge market for organic food. There are opportunities for organic farming business.”

Amitabh Kant

Kant however said there were challenges of availability of input seeds and planting material.

“Availability of organic seeds and planting machines is the most limiting factor. Also, we need to establish facilities that are able to produce consistent quality products. What is critical is consistent quality production. This is where we lack,” he said.

In the event organised by Indian Council for Research on International Economic Relations, Food Safety and Standards Authority of India Chairman Ashish Bahuguna said organic farming was the “effective instrument” to promote idea of sustainably and increase wealth of farmers.

He also said that Indian policies have kept agriculture away.”Farmers are kept at the margins of policies formulation,” he said.

Bahuguna said as per the National Institute of Nutrition, nutrient content in food has depleted in last 30 years “since we took away more from soil than putting in”.

He also raised concerns over use of labels such as green product, eco-friendly products and organic products by reputed brands and retail outlets.

“It confuses consumers,” he said.

Arpita Mukherjee, who co-authored the report “Organic farming in India: Status, Issues and Way Forward”, said consumers do not know which is thee right organic product.

“There is no right policy in place,” she said.

Other authors of the report are Souvik Dutta, Tanu Goyal, Avantika Kapoor and Disha Mendiratta. (IANS)

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India’s economic fundamentals stable, says Council chaired by Jaitley

Aug 22, 2017 0

New Delhi– India has macro-economic stability on the back of structural reforms like GST and the long term positive impact of demonetisation, with the financial markets expressing confidence through high-stock valuations, the Financial Stability and Development Council (FSDC) noted in its meeting held on Tuesday.

The 17th meeting of the FSDC was held here under the chairmanship of Finance Minister Arun Jaitley.

“The Council noted that India has macro-economic stability today on the back of improvements in its macro-economic fundamentals, structural reforms with the launch of the Goods and Services Tax (GST), action being taken to address the Twin Balance Sheet (TBS) challenge, extraordinary financial market confidence, reflected in high and rising bond and especially stock valuations and long-term positive consequences of demonetisation,” the Finance Ministry said in a statement.

Arun Jaitley

It also deliberated on strengthening the regulation of the Credit Rating Agencies (CRAs).

The Council also discussed the issues and challenges facing the Indian economy and the members agreed on the need to keep constant vigil and be in a state of preparedness for managing any external and internal vulnerabilities.

It also took note of the progress of financial sector assessment programme for India, jointly conducted by the International Monetary Fund and the World Bank.

“The Council directed that the assessment report should be finalised by the end of this year,” it said.

A presentation on the state of economy was made by Chief Economic Adviser (CEA) Arvind Subramanian.

The meeting was attended by Reserve Bank of India Governor Urjit R. Patel, Finance Secretary Ashok Lavasa, Economic Affairs Secretary Subhash Chandra Garg, Financial Services Secretary Anjuly Chib Duggal, Ministry of Corporate Affairs Secretary Tapan Ray, Ministry of Electronics and Information Technology Secretary Ajay Prakash Sawhney, Securities and Exchange Board of India (Sebi) Chairman Ajay Tyagi, Insurance Regulatory and Development Authority of India (IRDAI) Chairman T.S. Vijayan, Pension Fund Regulatory and Development Authority (PFRDA) Chairman Hemant G. Contractor and other senior officers of the government and financial sector regulators.

FSDC took note of the developments and progress made in setting up of Computer Emergency Response Team in the Financial Sector (CERT-Fin) and Financial Data Management Centre and discussed measures for time bound implementation of the institution building initiative.

A brief report on the activities undertaken by the FSDC sub-committee chaired by the RBI Governor was placed before the Council.

It also undertook a comprehensive review of the action taken by members on the decisions taken in earlier meetings of the Council.

The Central KYC Registry (CKYCR) system was also discussed and the Council took note of the initiatives taken in this regard by the members and discussed the issues/suggestions in respect of its operationalisation.

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Digital advertising spend in India to touch Rs 9,700 crore by end-2017

Aug 21, 2017 0

New Delhi– The digital advertising spend in India is expected to continue at a compound annual growth rate (CAGR) of 33 per cent to touch Rs 9,700 crore by December 2017, a recent study said here on Monday.

The digital advertising spend was estimated to be around Rs 7,300 crore at the end of 2016, growing at a rate of 40 per cent over 2015.

The report – Digital Advertising in India – jointly done by Internet and Mobile Association of India (IAMAI) and IMRB Kantar said that the digital advertising spend is about 14 per cent of the total advertising spend in the country.

In terms of volume, e-commerce leads the digital advertising spends with around Rs 1,361 crore, followed by fast moving consumer goods, consumer durables and banking, financial services and insurance (BFSI), it said.

“However, a comparison of these verticals in terms of share of spends on traditional versus digital show that BFSI organisations incurred the highest share on digital advertising spends. Around 40 per cent of their overall advertising spend was on digital followed by e-commerce, telecom and travel,” the statement said.

In 2016, it is estimated that search ads (close to Rs 2,044 crore) constituted 28 per cent of the overall ad spends followed by video (close to Rs 1,387 crore) which contributes to around 19 per cent; mobile and social media (close to Rs 1,314 crore) each are at around 18 per cent and display ads (close to Rs 1,168 crore) at 16 per cent, the report said.

It added that spends on video ads have shown a significant increase and accounted for 19 per cent of the overall spends in digital advertising. (IANS)

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GST to enable brand licensing industry to grow in India

Aug 20, 2017 0

Mumbai–The implementation of Goods and Services Tax (GST) will enable brand licensing industry to grow in India and also allow retail industry to start respecting intellectual property rights, an official said on Sunday.

“Modern retail would unlock itself because of GST. The new tax system will provide level playing field for all the players. We will start respecting lot of intellectual property rights (IPs) now and it will boost the brand licensing business ” License India’s Chairman Gaurav Marya said on the sidelines of the India Licensing Expo 2017.

Brand licencing is basically renting the brand to an industry manufacturer or retailer to use it for promoting their own products in the potential market.

The GST also provides opportunities to lot of international brands to look at India, not only as a “big consumption market” but also as “level playing field”,” he said adding that the government has been supportive of regularising the trade.

In his address at the Expo, Viacom International Media Networks’ Vice President, Licensing and Business Development, Dan Frugtniet said the growth potential in terms of the market in India is huge.

Marya also said the two day Licensing Expo which commenced on Sunday provides an opportunity to unlock lot of domestic intellectual properties or brands for the international markets.

Renowned chef Sanjeev Kapoor meanwhile emphasised on monetising the core expertise or values that the country has. Inspired by R.K. Laxman’s cartoon character “Common Man”, his granddaughter Rimanika Laxman created “Common Woman”, which was launched at the Expo by Bollywood actress Taapsee Pannu.

More than 100 global and domestic brands were present and over 5,000 delegates are attending.

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Huge opportunity in sustainable urbanisation in India: Amitabh Kant

Aug 18, 2017 0

New Delhi–Niti Aayog CEO Amitabh Kant on Friday said that India has a “huge opportunity” to go in for sustainable urbanisation.

According to the Niti Aayog CEO Kant, urbanisation process has ended in the US, Europe and has almost been completed in China and that India can learn from these examples to go in for sustainable urbanisation.

“India has a huge opportunity that when we start the process of urbanisation… we have the possibility of doing a lot of innovative and sustainable urbanisation,” Kant said at a late night event here.

“We need to create cities which are compact, low polluting, which recycle water,which recycle waste. So, there is a huge opportunity for all of us to do sustainable urbanisation and create a model for the rest of the world,” he said.

Kant was speaking at the Directors’ Conclave and 27th IOD (Institute Of Directors) Annual Meet which was held here on Friday.

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300,000 shell companies uncovered: Modi

Aug 15, 2017 0

New Delhi– More than three lakh “shell companies” set up to facilitate generation of black money have been unearthed by the government, Prime Minister Narendra Modi said on Tuesday.

“The drive against black money has led to the discovery of many shell companies. Following demonetisation, over three lakh companies have been found which are nothing but shell companies,” Modi said in his speech here on the occasion of Independence Day.

“Of these, the registrations of 175,000 companies have been cancelled,” he said.

Highlighting the enormity of the black money menace, Modi said up to 400 bogus firms were found to be operating from a single address.

Last week, stock markets regulator Securities and Exchange Board of India (Sebi) imposed trade restrictions on 331 firms suspected of being shell companies.

These securities were placed in suspended animation, implying that trade in these stocks will be permitted only once a month.

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Higher food prices in India accelerate July’s retail inflation

Aug 14, 2017 0

New Delhi– A rise in food and fuel prices led to a rise of 2.36 per cent in India’s retail or consumer price index (CPI) based-inflation in July, official data showed here on Monday.

According to the Ministry of Statistics and Programme Implementation, last month’s CPI inflation rose to 2.36 per cent from 1.46 per cent in June.

However, on a year-on-year (YoY) basis, the country’s July retail inflation was lower than the 6.07 per cent CPI rate reported for the corresponding month of last year.

As per the ministry’s data, retail inflation in July was pushed higher by a rise in prices of cereals, milk-based products, meat and fish.

On a sequential basis, the Consumer Food Price Index (CFPI) rose by 3.21 per cent during the month under review when compared to June 2017.

The data on a YoY basis, showed that cereals prices in July edged higher by 3.97 per cent, and meat and fish recorded a sharp rise of 3.19 per cent.

Food and beverages during the month under consideration recorded a marginal rise of 0.43 per cent over the same month last year.

Among non-food categories, ‘fuel and light’ segment’s inflation rate accelerated to 4.86 per cent in July.

The rural CPI YoY ruled higher at 2.41 per cent, whereas in urban areas it was at 2.17 per cent.(IANS)

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Global cues, foreign fund outflows drag equity indices to 5-week lows

Aug 12, 2017 0

By Porisma P. Gogoi

Mumbai– The key Indian equity indices — the Sensex and the Nifty50 — dived into the bearish zone and settled at their five-week lows, as global cues, a bulk of quarterly earnings and substantial amount of foreign fund outflows urged investors to book profits.

On a weekly basis, the 30-scrip Sensitive Index (Sensex) of the BSE lost 1,111.82 points or 3.44 per cent to close below the 32,000-mark at 31,213.59 points. The Sensex breached that level for the first time on July 13.

Meanwhile, the Nifty50 of the National Stock Exchange (NSE) closed at 9,710.80 points by shedding 355 points or 3.53 per cent. At one point on Friday, the Nifty50 fell below the psychologically important 9,700-mark, which was crossed for the first time on June 6.

“Markets corrected sharply this week after five weeks of consecutive gains. The Nifty began correcting after touching a high of 10,088 on Monday Aug 7, 2017,” Deepak Jasani, Head – Retail Research, HDFC Securities, told IANS.

“Sectorally, there were no gainers for the week. The top losers were the realty, PSU banks, pharma and media indices.”

On the currency front, The the Indian rupee weakened by 55 paise to close the week at 64.13-14 to a US dollar from its previous week’s close at 63.58-59.

According to Dhruv Desai, Director and Chief Operating Officer of Tradebulls, the entire week was on the “sell side” with the S&P BSE Sensex falling nearly 1,000 points in just nine trading sessions of August.

“The carnage was seen more in small and mid-cap space which fell 20-30 per cent in a matter of days after hitting record highs last month,” Desai told IANS.

“Things turned cautious in the month of August when the Securities and Exchange Board of India (SEBI) on Monday placed trading curbs on 331 stocks of firms suspected to be shell companies.”

On August 8, stock market regulator SEBI imposed trade restrictions on 331 firms which were suspected of being “shell companies”. These securities were placed in suspended animation from the next day, as exchanges stated that the trade in these stocks would be permitted only once a month.

“Besides the spillover of the ‘shell’ shock, a flare-up in geopolitical tensions following North Korea’s nuclear tests and dozens of quarterly earnings kept markets in a tizzy,” said D.K. Aggarwal, Chairman and Managing Director, SMC Investments and Advisors.

“The sentiments in the market remained downbeat due to sustained capital outflows by foreign funds and retail investors on the domestic bourses. As a result, the Nifty fell below the 10,000-mark for the first time in two weeks,” he added.

Provisional figures from the stock exchanges showed that foreign institutional investors sold stocks worth Rs 2,615.9 crore, while domestic institutional investors bought scrips worth Rs 4,498.43 crore during August 7-11.

Figures from the National Securities Depository (NSDL) revealed that foreign portfolio investors (FPIs) divested equities worth Rs 549.47 crore, or $85.76 million, during the week ended August 11.

The top weekly Sensex gainers were: Tata Steel (up 3.59 per cent at Rs 596.15), Infosys (up 0.24 per cent at Rs 987.75), and Wipro (up 0.21 per cent at Rs 289.90).

The losers were: Tata Motors (down 13.95 per cent at Rs 374.40), Tata Motors (DVR) (down 12.66 per cent at Rs 223.20), Sun Pharma (down 10.92 per cent at Rs 451.30), Dr. Reddy’s Lab (down 10.37 per cent at Rs 2,011.35) and State Bank of India (down 8.12 per cent at Rs 280.65). (IANS)

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Japanese firm to invest Rs 1,000 cr in Andhra

Aug 10, 2017 0

Amaravati–Toray Industries Inc, a Japanese multinational corporation, will invest Rs 1,000 crore for the manufacture of technical textiles in Andhra Pradesh.

Chief Minister N. Chandrababu Naidu on Thursday approved the project, which will come up in Sri City, a special economic zone in Chittoor district.

The plant will be the largest among Japanese units in Sri City.

The project, the foundation stone for which will be laid next year, will provide direct employment to more than 100 people and indirect employment to 300-400 people. (IANS)

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