Flipkart Sheds Spending Flab to Get Into Shape
As investors ask hard questions & going gets tough, Internet cos are having to change biz models & temper valuation hopes CEO Binny Bansal is taking steps to build a self-sustaining biz to take on competitors Startups Cutting Joining Bonuses
Aditi Shrivastava & Madhav Chanchani
Bengaluru: Flipkart is racing to cut expenses and earn a gross profit ahead of the festival season starting in September, when demand for big discounts will renew the fractious battle to dominate the country’s online retail market.
The drive to build a self-sustaining business, being led by Flipkart’s new chief executive officer Binny Bansal, includes a series of measures from capping salary increments at 10% to giving category heads six months to become profitable at a unit level.
All this while the company reduces the amount of money used to expand the business — termed the burn rate — by half, according to several people aware of the company’s strategy. India’s most valued Internet company looking to bring down burn rate by Co looking to cut burn by capping appraisals, focussing on categories that do well and shutting down those that don’t meet customer experience and profitability targets Slowing funding and concerns over valuation are forcing Indian startups to cut joining bonuses, report Anumeha Chaturvedi & Rica Bhattacharyya.
more than 50% to $40 million/ month
ED first summoned Mallya to appear on March 18 and set a fresh date of April 2 after he sought more time. The businessman again sought time till May but the agency extended the deadline only by a week to April 9.
Mallya, in his communication to the agency, claimed that he has already given statements to the Central Bureau of Investigation and the Serious Fraud Investigation Office. He also cited ongoing legal proceedings in the SC on a settlement of loans, a senior official said, requesting anonymity.
ED ruled out the possibility of Mallya’s appearance through video conferencing. “The summons issued under money laundering charges asked for personal appearance and not distant appearance. The state- ment given by a suspect needs to be signed by him, without which it cannot be submitted to the court after investigations,” added an official. On the request for revocation of the diplomatic passport, authoritative sources told ET they want a proper directive and additional steps are being taken in consultation with ED and the Department of Legal Affairs to make a fool-proof case to avoid embarrassment. MEA had revoked Lalit Modi’s passport on ED’s directive. Modi got his passport restored by the Delhi HC in August 2014 on the grounds that his personal appearance was not mandatory under the Foreign Exchange Management Act, the show-cause notice issued to him was still pending with the adjudicating authority and no penalty had been levied.