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  • Royal Enfield’s Parent Company Eicher Motors Debuts On Dow Jones Sustainability Index

    Royal Enfield’s Parent Company Eicher Motors Debuts On Dow Jones Sustainability Index

    Eicher Motors Limited (EML), the parent company of Indian motorcycle brand Royal Enfield, has made its debut on the Dow Jones Sustainability Indices (DSJI) – Emerging Markets category. Eicher Motors is one among only ten global automotive companies to feature on the list for 2021, and is one among three Indian automobile companies on the list. With more than 100 percent year-on-year improvement in its score, Eicher Motors Limited is ranked at an overall 8th position in the list of sustainability leaders in emerging markets.

    The DJSI rankings highlight EML’s increased focus on developing and shaping a robust Environmental, Social, and Governance (ESG) vision, with measured commitments, targets, and direction for the future. These include improving and adopting effective and environment-friendly manufacturing processes, working towards attaining carbon neutrality, eliminating the usage of single-use plastics, focus on road safety, community development and vocational training programs, among other initiatives.

    Speaking about this achievement, Siddhartha Lal, Managing Director of Eicher Motors Ltd, said, “As we chart EML’s next stage of growth with an immense focus on our strategic business plans and goals, an effective and impactful Environmental, Social and Governance (ESG) vision is a key aspect to define this growth for us. Over the last few years, we have made significant strides across all parameters to deliver positive results in line with a renewed ESG vision. Our inclusion in the DJSI index is a testament to the success of our initiatives and direction. We are committed to making concerted efforts to further realize this vision and deliver a positive impact across the entire product value chain.”

    Royal Enfield’s highest-selling model is the Classic 350, which has sold over 40 lakh units during the past decade. The 2021 Royal Enfield Classic 350 is better in every aspect. It has better engine refinement, better dynamics, and comes with more features and color options.
    Created jointly by S&P Dow Jones Indices and SAM (Suitable Asset Management), the DJSI combines the experience of an established index provider with the expertise of a specialist in Sustainable Investing to select the most sustainable companies from across 61 industries. The indices serve as benchmarks for investors who integrate sustainability considerations into their portfolios and provide an effective engagement platform for investors who wish to encourage companies to improve their corporate sustainability practices.

    Eicher Motors Limited registered an overall score of 61 points and featured in the 76th percentile in FY21 as compared to a score of 29 points and a percentile position of 50 in FY20. The company has marked a significant uptick as compared to its previous performance in the DJSI across all parameters including Governance & Economic Dimension and Environment Dimension amongst others. A total of 360 Indian companies were invited to participate in DJSI in 2021, out of which EML made it to an exclusive list of 15 Indian companies which became a member of the DJSI Emerging Markets Index across all sectors.

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  • Vingroup sets up drug company

    Vingroup sets up drug company

    Vietnam’s largest private company, Vingroup, has established pharmaceutical company Vinbiocare with a charter capital of VND200 billion ($8.6 million).

    Its focus will be on medicine, vaccines.

    Vingroup owns 69 percent of Vinbiocare Biotechnology JSC, its formal name, which is headquartered in Hanoi, while Phan Quoc Viet, CEO of tech firm Viet A Technology Corporation, owns 30 percent. The remaining 1 percent is held by an individual investor, Phan Thu Huong.

    Mai Phuong Noi, deputy CEO of Vingroup, is its chairwoman.

    Vingroup entered the pharmaceutical industry in 2018 by establishing Vinfa JSC and setting up a plant in Gia Binh District in the northern Bac Ninh Province.

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  • How To Improve Your Company’s Finances

    How To Improve Your Company’s Finances

    Every business is bound to face some rock bottom numbers at some point — sales are not always going to be well above average and there are indeed going to be certain dry spells at times. In times like these, it is important to step back and take up new strategies to help make your numbers go back up, and hard balling with the same tactics stubbornly is not going to help the situation better. As such, there are many ways to improve your company’s finances, and all it takes is to look at the bigger picture and re-evaluate the steps that you need to take to prevent your company from plummeting further. It might even be helpful to use tools to make managing your finances a quicker process; in fact, here is a paystub generator tool to get you started. So without further ado, here are some steps you can take to hopefully help your company take a turn for the better.

    Organize Regular Team Meetings

    When the going gets tough, it may be increasingly tempting to skip out on meetings especially when everyone is mindlessly scrambling about to keep the boat afloat. However, this will cause more instances of miscommunication to arise, leading to ineffective execution of tasks and misalignment of goals. As such, organizing regular team meetings help to ensure that the team is on the same page with the same end goal in mind. This aids everyone in staying focused and being sure of what they need to do and when to get them done. Regular meetings also give your team opportunities to pitch and brainstorm possible business strategies to adopt, as well as the chance to regularly update one another on the progress of the entire company as a whole.

    Moreover, frequent team meetings will help boost the morale of your employees, which may help your business spring back to normal faster than you know it.

    Reduce Tax Burden

    Especially during times when your business is going downhill, it is useful to find ways to legally reduce the tax burden for your company. Depending on the state you are living in, it is incredibly useful to talk with your local tax accountants to find out your options in your area to reduce taxes. For example, some companies may find it useful to open up a SEP IRA on top of their Roth IRA since contributions made to the SEP account can be used to deduct from their taxes. This gives you the option of having more cash to keep, which you can use to clear the mountain of debts and payments to be made.

    Track Your Finances

    Though this is not only essential when your company hits the rut, it is always good practice to regularly check on your company’s finances to discern whether your money is put into good use. Start evaluating the budgets set aside for the different departments and see if there are areas that you can cut some costs. For example, cutting costs in the innovation tech department and pumping in more money in aggressive advertising on the relevant social media platforms might help draw customers to your brand.

    Apart from that, it is also wise to start tracking your investment decisions. Is your wealth growing? Are these investment decisions wise? More often than not, deciding whether your investment choices are worth it or not will take several months, but you should still keep your eye on them. Also, if there are several investment areas that have been reaping rewards, maybe closing the account will help your company secure cash to tide over your financial instability.

    Furthermore, some companies may get lost in the endless list of stalled projects and missed invoices that they may also miss out on client payments. Getting your finances back on track would obviously help if you, well, make sure you get paid. Catching up on these missed payments may give you access to a huge sum more than you can imagine, which will greatly help you level the negative account balance.

    Tackle Problems When They Arise

    It may seem second-nature to push back financial problems as each one comes, especially when you are already drowning in a heap of those. However, delaying solving these problems will not make it go away, and instead may cause you to incur additional fees and payments when they are past the deadline. Hence, a rule of thumb is to face any financial issues as soon as they arise. Even if you do not have the financial capabilities to do so, you should try to eradicate these problems by switching around your finances, or seeking a professional for financial advice to tide you through. These also help to minimize the impact of these pressing debts first, helping you to simultaneously assess how you can improve your cash flow management.

    Re-evaluate Your Mindset

    In the midst of a negative account balance, it is important to set your mind to it and develop a healthy mindset to tackle your problems. Just like maintaining your physical fitness, it is important to keep your emotional wellness in check as it forms the foundation of whether you can succeed or not. Instead of coming to work every day feeling dejected and helpless, channel your energy into cultivating a positive mindset, and believing that your business will eventually improve if you have the correct mindset. Making sure your employees feel the same will help your team more effectively and exacerbate the process to recovery.

    Conclusion

    While these are some of the most common ways you can improve your company’s finances, this list is definitely not a set of hard and fast rules that guarantee success. It ultimately depends on the type of strategies you adopt, according to how well you understand your business and the market. It requires a lot of perseverance and a ton of effort to keep your business afloat, and possessing such qualities will make the process of coming out of a financial rut a whole lot easier. If things get too rough, it will be helpful to speak to a professional to give you appropriate financial advice tailored to your situation and company.

     

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  • Singapore Fintech Firm Heading into Indonesia

    Singapore Fintech Firm Heading into Indonesia

    Following a successful Series B funding round, SME lending platform Validus Capital is launching in Indonesia. SME lending platform Validus Capital has launched in Indonesia, its first Southeast Asian market outside its home country of Singapore, the firm announced in a media release on Thursday.

    Launched in partnership with Indonesia’s Triputra Group under the name Batumbu, the financing platform connects domestic SMEs from sectors as diverse as food and beverage (F&B), services, engineering, to construction industries with accredited, institutional and high net worth investors.

    Leading the local management team is Sonny Christian Joseph, who has over 23 years in SME banking in Indonesia and was previously head of SME banking at Indonesian business bank BTPN.

    P2P lending platforms have gained popularity and have grown rapidly in Indonesia. In 2018, P2P lending platforms disbursed a total of US$1.4 billion (S$1.9 billion) in loans, representing a 681.25 per cent year-on-year growth, according to data from Indonesian financial services authority Otoritas Jasa Keuangan.

    «Our expansion into Indonesia serves as a significant milestone for us. Sharing our insights and applying key learnings from Singapore allows us to take a proven and sustainable business model and apply this to a larger market – a market where I have personally spent a few years helping SMEs to grow,» Ajit Raikar, Validus CEO and co-founder, said.

    Unlike traditional financing options and P2P lenders, Butumbu uses proprietary technology and credit scoring systems adapted and tailored to cater to the needs of SMEs in Indonesia. The firm said that  it will develop strategic partnerships with large corporations to ensure an extremely robust and scalable financing ecosystem.

    In February 2019 Validus recently raised US$15.2 million (S$20.5 million) in an oversubscribed Series B funding round led by Dutch public-private development bank FMO.

    Validus was founded in 2015 and is backed by the likes of Netherlands development bank FMO and Temasek Holdings’ Vertex Ventures. According to the company, it is Singapore’s largest peer-to-business lending platform, facilitating over US$147 million (S$200 million) in business financing to local SMEs in less than 18 months.

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  • Cebu Pacific income dives in 2018

    Cebu Pacific income dives in 2018

    Cebu Air reported its net income plunged 50.6% to P3.9 billion in 2018, from P7.9 billion in the previous year, due to the “challenging macro environment.”

    In a statement over the weekend, the operator of Cebu Pacific noted the high fuel prices, volatile Philippine peso, rising interest rates, increased competition, six-month closure of Boracay, and operational limitations of key airports as factors that affected its bottomline last year.

    Airlines around the world took a hit from rising jet fuel prices last year, which only started going down in the fourth quarter, based on data from the International Air Transport Association (IATA). The average price of jet fuel during the nine-month period was at $85.37 per barrel, 36% up from $62.89 per barrel in the same period in 2017.

    Adding to Cebu Air’s problem is the weakening of the Philippine peso, which recorded an average of P52.66 per dollar in 2018, a steep decline from the P50.40-per-dollar it recorded in 2017.

    But despite the slump in its net income, Cebu Air said its revenue grew by 9% to P74.1 billion in 2018, driven mostly by its cargo business which posted a 19% growth. Passenger revenue was also up 9% to P54.3 billion in 2018.

    “Despite the pressures posed in 2018, we remained resilient. We were able to expand our network by upgauging our flights touching congested airports,” Cebu Pacific Chief Operations Officer Michael Ivan S. Shau was quoted as saying.

    In aviation, “upgauging” is a strategy used by airlines to increase capacity by replacing smaller planes with larger ones.

    Cebu Pacific said it ferried 20.3 million passengers last year, 2.7% higher than the previous year.

    The budget carrier said it is hopeful it will bounce back in 2019 with the acquisition of fuel-efficient planes and opening of new routes.

    “We will continue to pursue our fleet upgauging strategy and invest in the latest aircraft technologies, as well as develop secondary hubs like Cebu and Clark. We will also continue to grow our cargo business with the incoming ATR freighters as well as continue our digital transformation for us to be more agile and adaptable to changing customer expectations,” Mr. Shau said in the statement.

  • Ikea leasing program targets students and employees

    Ikea leasing program targets students and employees

    Swedish furniture and homewares retailer Ikea plans to launch furniture rental services in all of its main markets.

    The Ikea leasing strategy is twofold: firstly it addresses the budgetary constraints of customers who move frequently and cannot afford to replace furniture to suit their new space, and secondly to deliver on its sustainability promise by reducing waste and expanding the lifespan of furniture products.

    “You should be able to have a lovely home, and a good conscience, and you should be able to afford it,” said Ingka Group CEO Jesper Brodin in an interview with Reuters.

    Details of the plan, framed as a subscription-based leasing offer, were revealed during the launch of the company’s first ‘sustainable’ store in Kaarst, Germany, this week. Students in the Netherlands can already use the program, paying €30 a month to lease a table, chairs, a bed and a desk. In Switzerland and Sweden, Ikea is developing a similar plan for office furniture.

    Brodin said many Ikea customers are moving home more often than in the past and buying new furniture to fit new spaces can be a financial burden. Using the new Ikea leasing service, they can simply swap out furniture each time the move without having to worry about how they sell or dispose of their existing items.

    The Ikea leasing concept also taps into the pervasive sharing culture in which younger generation consumers embrace renting items rather than owning – including music, fashion and motor vehicles.

    The program is also in line with Ikea’s mission to be affordable, convenient and look after the planet.

    Ikea says it will test the rental concept in all 30 of its markets by 2020. Furniture items will be repaired or refurbished between leases and when too old to be leased out, recycled.

    Pia Heidenmark, Ikea’s head of sustainability, added another advantage of the program: by taking furniture back, the company will be able to assess the durability of its products and feed that information back to its design team.

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  • Tealive parent Loob Holding eyes on IPO

    Tealive parent Loob Holding eyes on IPO

    Tealive parent Loob Holding, is planning an IPO to fund ‘aggressive expansion’. The company is looking to open 1000 Tealive stores in 15 countries by the end of next year.

    Along with another 150 new outlets in India by 2024.

    China is still its focus market, with 500 more outlets to come after first outlet opened last November.

    Tealive has more than 200 outlets in its home market, seven in Vietnam, two in China, and one in Australia. About one third of these are operated by franchisees.

    Loob Holding CEO Bryan Loo said the company is building relationships with potential business partners in Japan, Indonesia, Myanmar, Mongolia, and the UAE, while Singapore is also in its expansion plan.

    Apart from Tealive, Loob also runs F&B franchises in Malaysia, including Gindaco, Croissant Taiyaki, Define:food, Define:burgers and Ko Ko Kai.

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  • Canada Goose revenues surge more than 50%

    Canada Goose revenues surge more than 50%

    Canada Goose Holdings announced its financial results for the third quarter, highlighting a surge in revenues after new store openings both physical and online. For the quarter ended December 31, 2018, the North American outdoorwear company said total revenues increased by 50.2% to $399.3m from $265.9m, or 49% in constant currencies.

    Direct-to-consumer sales totalled $253.3m from $131.7m last year, driven by the strong online and in-store sales. Canada Goose said it opened five new stores during the quarter and an online store.

    Wholesale revenue increased to $164m from $134.2m, on the back of higher order values from existing partners, coupled with earlier shipment timing relative to last year.

    The Toronto-based company reported net income came in at $103.4m, or $0.93 per diluted share, compared to $63m, or $0.56 per diluted share. The 64% increase was due to higher operating income and a lower effective tax rate, said Canada Goose.

    Adjusted EBITDA was $151.1m, compared to $94.7m.

    “Fiscal 2019 is shaping up to be another year of impressive results. In our peak selling season we continued to deliver when and where it matters most, while also strengthening our foundation for future success on the global stage,” said Dani Reiss, Canada Goose President & CEO.

    “We have successfully entered new markets, introduced new product, and increased capacity to meet growing demand in both channels. We remain deeply confident in the long runway we have ahead.”

    Looking ahead for 2019, annual revenue growth is projected to be in the mid-to-high thirties on a percentage basis, compared to at least 30%.

    Annual growth in adjusted net income per diluted share is now predicted to be in the mid-to-high forties on a percentage basis.

    Founded in 1957, Canada Goose is today one of the world’s leading makers of performance luxury apparel. The Made-In-Canada advocate employs more than 3,400 people worldwide.

    In Asia, the Canadian brand has flagships in Tokyo, Beijing and Hong Kong.

  • Vietnamese beer sales now drive revenues for Sabeco’s new Thai owner

    Vietnamese beer sales now drive revenues for Sabeco’s new Thai owner

    Vietnamese brewery Sabeco has contributed 46 percent of the revenues of Thai parent ThaiBev in the first quarter of 2018-19. For the quarter ended December 31, 2018, it reported sales of VND13 trillion ($560.58 million) as ThaiBev announced net profits of VND5.54 trillion ($238.83 million) on total revenues of VND54.28 trillion ($2.34 billion), 35 percent and 60 percent up year-on-year.

    Beer products became its revenue driver for the first time with sales of VND24.84 trillion ($1.07 billion). Though spirits sales saw strong growth, their share of revenues dropped from 54 percent to 43 percent.

    In terms of sales by market, the group reported 52 billion baht ($1.66 billion) in Thailand, down to 71 percent from 96 percent last year. The other significant amount was Vietnam’s VND13 trillion or 23.9 percent.

    ThaiBev said while consumption in Southeast Asia is generally slowing, Sabeco has sustained impressive growth.

    Two months ago the Thai group became the majority shareholder in the Vietnamese brewer with a 53.59 percent stake following a debt-to-equity swap.

    It believes the acquisition of Sabeco would help its expansion in Vietnam, which has a youthful population, extensive distribution network and the strongest beer market growth in the region.

    Sabeco, formally known as Saigon Beer Alcohol Beverage Corp, reported a 5 percent rise in revenues last year to more than VND36 trillion ($1.56 billion).

    It has a 42.8 percent share of the Vietnamese beer market, according to the Ho Chi Minh City Securities Corporation.

    According to the Vietnam Beverage Association (VBA), the Vietnamese beer market is worth $3.4 billion.

    Securities company FPT Securities predicts the market will grow by 5-6 percent a year.

  • English learning app co-founded by Vietnamese raises $7 million

    English learning app co-founded by Vietnamese raises $7 million

    ELSA has raised $7 million in a Series-A round from Google’s AI Fund Gradient Ventures and other U.S. investors. The investment round for ELSA, a mobile app that uses artificial intelligence and speech recognition technology to help language learners improve their English pronunciation, was led by Gradient Ventures, Google’s AI-focused venture fund.

    According to tech news provider Engadget, the Google fund will also offer “technical mentorship” to AI startups. ELSA will gain access to Google itself, including prominent figures such as investor and futurist Ray Kurzweil, design mastermind Matias Duarte and X lab leader Astro Teller.

    U.S. fund SOSV and Singaporean Monk’s Hill Ventures, strategic investment funds from the previous investment round, also invested in the app. In three years after its establishment, ELSA has successfully attracted $12 million through funding rounds in Silicon Valley, the U.S. and Asia.

    CEO and co-founder Van Dinh Hong Vu revealed that this round of funding will help the startup continue to recruit computer engineers and computer scientists in AI, and to explore new markets like Japan, Indonesia and India.

    ELSA currently has 4 million users from 101 countries worldwide, making it one of the top 5 AI applications with the most users. In 2018, the application recorded an increase in student enrolment by 350 percent over the previous year.

    Vietnam has been the fastest growing market for ELSA. ELSA grew its business fourfold in Vietnam in 2018 and expects to grow at a faster pace in 2019.

  • Takeover bid lodged for struggling Laura Ashley

    Takeover bid lodged for struggling Laura Ashley

    US investment company Flacks is considering making a bid for Malaysian-owned, British fashion retailer Laura Ashley. The firm is in the “very preliminary stages” of a takeover bid for the brand. Any possible takeover offer will be limited to 2.748p in cash per share, resulting in an overall valuation for the retailer at around £20 million (US$26.38 million), according to an announcement by the firm confirming the details.

    If Flacks buys Laura Ashley, it is expected to primarily focus on the US market and other non-European markets.

    “As far as I am concerned, there is no takeover bid because there has been no approach whatsoever,” Laura Ashley chairman Andrew Khoo told investors on Monday, a day prior to Flacks’ announcement. “If and when an approach is made, the board will discharge its duties as always and assess it on its relative merits.

    “I would, however, like to state for the record that as major shareholders of Laura Ashley, we have no intention of divesting our controlling stake,” he continued. “Whilst I understand why potential parties would think we are significantly undervalued, I have complete confidence that we will be able to grow profitably and in a sustainable manner so as to create long-term value for our shareholders.”

    A recent report issued by the firm warned that its full-year profits would “fall short of market expectations” following announced plans to close around 30 of its remaining 120 stores to control costs in the firm’s competitive and sluggish market. The firm filed a £1.5 million ($1.98 million) loss in the final half of last year.

    Laura Ashley’s Australian business collapsed late last year, but in December Khoo said he believed the brand’s future lied in Asia, where he was planning expansion.

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  • Maybank achieves record earnings of RM8.11 billion for 2018

    Maybank achieves record earnings of RM8.11 billion for 2018

     Malayan Banking Bhd’s (Maybank) registered highest ever net profit of RM8.11 billion for the financial year ended December 31, 2018 (FY18) from RM7.52 billion a year ago, mainly underpinned by higher loans growth, lower overhead costs as well as lower provisioning. Its FY18 revenue also rose 3.8% to RM47.32 billion against RM45.58 billion previously.

    Net profit for the fourth quarter, meanwhile, grew 9.1% to RM2.33 billion from RM2.13 billion in the same quarter a year ago, with revenue expanding 3.8% to RM12.23 billion from RM11.79 billion.

    The bank has proposed to declare a final dividend of 32 sen per share for the quarter under review.

    Together with the 25 sen interim dividend declared earlier, the full-year dividend payout of 57 sen per share amounts to RM6.3 billion or 77.3% of net profit.

    The total dividend payout also translates into a higher dividend yield of 6% versus 5.6% in 2017.

    In 2018, Maybank’s achieved a record net operating income which rose 1.7% to RM23.63 billion, on the back of a 3.1% increase in fund based income as a result of higher contributions from all business sectors and key home markets.

    Group gross loans expanded at a faster pace of 4.8% in FY18, compared with 1.7% previously. The Malaysian operations saw loans expanding 4.8%, Singapore 4.5%, Indonesia 7.0% and 10.9% for other international markets.

    Maybank also highlighted that its net impairment losses for the year coming in 20.5% lower than the previous year, lifting operating profit by 9.3% to RM10.8 billion in 2018.

    For Q4 alone, it also saw net impairment losses coming in 58.1% lower than Q3.

    The bank continued to maintain a healthy liquidity position with its liquidity coverage ratio of 132.4% and loan-to-deposit ratio of 92.7%. Total capital ratio was 18.51% while its fully loaded common equity tier 1 ratio stood at 14.51%, both well above the regulatory requirements of 8.0% and 4.5% respectively.

    On its prospects, Maybank said it will maintain its balance sheet expansion in line with forecast economic growth of its three home markets, in tandem with the group’s risk posture, and continue building on its diversified franchise and footprint to expand income streams through cross business collaborations and focusing on diligent pricing of its assets and liabilities.

    Barring any unforeseen circumstances, the group expects its financial performance for 2019 to be satisfactory in line with the expected growth prospects of its key home markets.

    The group has set the headline key performance indicator (KPI) for return on equity (ROE) of approximately 11%.

    At 2.35pm, Maybank’s share price was trading unchanged at RM9.54 on 3,344,100 shares done.

  • Convenience drives Chinese smart-home market

    Convenience drives Chinese smart-home market

    New research from market intelligence agency Mintel has suggested that convenience will drive the future of the Chinese smart-home market. However, affordability is the biggest barrier to purchasing, in an environment where today’s Chinese consumers are growing increasingly familiar with smart home devices. According to Mintel, as many as 68 per cent of urban Chinese consumers who have purchased or are interested in smart-home devices say that convenience is a primary reason for their interest. Meanwhile, 60 per cent attribute their interest in smart-home devices to trying new technology and half because smart home devices make them feel more relaxed at home.

    “Chinese consumers are now increasingly knowledgeable about how smart-home appliances can help to simplify daily lives,” said Mintel China research analyst Kaye Huang. “Convenience as well as an interest in trying new technology are big reasons for Chinese consumers to purchase smart-home devices. Parents are showing more interest in smart-home devices than those without children; which is likely to be attributed to how the devices can help parents save time and effort. On the flip side, price, more so than privacy, is what is keeping Chinese consumers from purchasing these devices. This indicates that companies in the smart-home market need to put more effort into communicating why these products are value for money.”

    Meanwhile, Mintel research reveals that automatic adjustment to environmental changes is a big opportunity for players in the smart home devices market; more than half of urban Chinese consumers think that this function is a necessity.

    “What will stand out in the smart-home market is the ‘automatic adjustment of parameters’ which enables smart-home devices to automatically respond to environmental changes, such as temperature and humidity. Today’s Chinese consumers have higher expectations on their living conditions and automation is an important part of making the living environment ‘smarter’,” said Huang.

    “Voice control has been a popular area of development in recent years especially since the industry believes that it could be the next generation of user interaction,” continued Huang. “Yet, our research finds that voice control, while widely-known, is a less-used smart home function. While playing music and asking for general information are two main functions that Chinese consumers are using for voice control, in reality this only counts for a handful of consumers, suggesting consumers’ habit of using voice control is far from being firmly established. In the future, brands can look at rolling out strategies and initiatives to instil the habit of using voice control among consumers in China.”

  • Foreign investment crucial to Vietnamese banks in 2019: Moody’s

    Foreign investment crucial to Vietnamese banks in 2019: Moody’s

    Most Vietnamese banks fall short of international capital adequacy norms and have to focus on attracting foreign capital this year, Moody’s has said. The credit rating agency said in a release Monday that “the underdevelopment of the domestic capital markets” means the banks would have to look to foreign investors to meet the capital requirement of 8 percent of risk-weighted assets to cover operational risks.

    Raising capital has been a struggle for Vietnamese banks in recent years. Major state-owned banks such as BIDV and Vietinbank have for long been making plans to increase charter capital but in vain.

    BIDV, the second largest listed bank, has had charter capital of nearly VND34.19 trillion ($1.46 billion) unchanged since 2015.

    Last November it planned to sell a 17.65 stake to South Korea’s KEB Hana Bank to increase it to over VND40.22 trillion ($1.73 billion), but the deal has not been consummated.

    Vietinbank, the fourth largest listed bank, has seen its capital remain unchanged since 2014 at VND37.23 trillion ($1.59 billion).

    Only Vietcombank, the largest listed bank in the country, last month raised VND6.2 trillion ($265.86 million) from selling a 3 percent stake to foreign investors, as part of its plan to ultimately sell 10 percent.

    BIDV and Vietinbank had offered to pay its largest shareholder, the State Bank of Vietnam (SBV), the previous year’s dividends in stocks and not cash to increase their capital, but the central bank refused saying it needed the cash.

    Moody’s added that the banks’ capitalization will strengthen this year because of stronger profitability and stable credit growth.

    It said that Vietnamese banks last year achieved a higher aggregate return on assets for a second year running, registering a rise of 1.1 percent from 0.9 percent in 2017.

    Aggregate net income for the banks rose 35 percent to VND70 trillion ($3 billion) in 2018 from the previous year, it said.

    “For 2019, Vietnamese banks that Moody’s rates will achieve a further improvement in profitability, again because of wider net interest spreads and lower credit costs,” said Rebaca Tan, a Moody’s analyst.

    “Credit growth will stay stable over the same period because of tighter control by the State Bank of Vietnam, and asset quality will improve further, as the banks continue cleaning up their balance sheets.”

  • Nintendo makes comeback in Korea with Switch

    Nintendo makes comeback in Korea with Switch

    Nintendo, the Kyoto-based game company, returned to Korea. After almost disappearing over the past decade in the storm of mobile and online games, it is returning to the market with Switch, a retro console that marries the latest technology with old favorites, like Pokemon. A 41-year-old surnamed Kim, a father of three, recently found his new favorite hobby: playing Switch. His two favorite games are Diablo 3 and Legend of Zelda: Breath of the Wild, both of which he used to enjoy years ago at attending university.

    He now plays the latest versions.

    “To advance to a higher level on smartphone games, I have to spend a lot of time and money, so I lost interest,” said Kim. “As for Switch, it’s like the games I played when I was younger. Just like arcade games, I can save the game and can continue playing it where it ended whenever I want. Also, the game itself is not too difficult.”

    Plenty of people seem to agree with Kim.

    Global sales of Switch from its introduction in March 2017 through late 2018 totaled 32.27 million units, according to a report from Nintendo. On average, 33.5 Switch consoles have been sold per minute. A total of 163.61 million Switch titles were bought during the same period.

    The Switch ended 2018 as the year’s best-selling hardware platform both in unit and in dollar sales terms, according to a report from NPD Group, a U.S.-based market-research company. Both in units and dollars, the Switch was the best-selling game since Sony PlayStation 4 in 2015.

    The Switch boom is evident in Korea, where consoles are not generally very popular. The product has been generating 51 percent of game sales at Emart, the main marketing channel for Switch.

    According to a report from Korea Creative Content Agency (Kocca), the size of the console game market in Korea grew by 42.2 percent from 2016 to 2017. Sales of Switch – which totaled more than 110,000 units in the first month of its release in Korea in December 2017 – and the rise of the related software sales were major contributors to the game market expansion, the report argues.

    Revival of Retro

    Nintendo, which was founded in 1889 as a playing-card company, most recently became an icon of innovation around year 2000 when it introduced Nintendo DS and Wii. Each sold more than 100 million units, and the strong sales in Korea led to the development of similar games locally.

    The success was short lived. The market began to change around 2010 as smartphone games started to develop and lead the market. In 2011, Nintendo experienced its first annual earnings loss since it was listed on the stock exchange in 1983.

    The company sought a rebound the following year with the Wii U, but only 13 million units were sold.

    Nintendo suffered losses for three years, and its presence in the console game market gradually waned with the dominance of the Sony PlayStation 4 and Microsoft’s Xbox. Nintendo’s share price dipped to as low as 8,060 yen ($73) from its November 2007 peak of 70,500 yen. The company’s weak performance continued until 2016, when Nintendo shook the game world with Pokemon Go, its wildly popular augmented-reality smartphone game.

    The comeback was confirmed with the release of Switch the following year.

    Popular with young and old

    Nintendo’s timing couldn’t have been better. It released Switch just as the newtro trend was gaining ground. Newtro, a portmanteau of new and retro, is reviving many long-dormant styles and products.

    The most popular titles in the early days of Switch – Super Mario Odyssey, Legend of Zelda and Pokemon: Let’s Go, Pikachu! – are the latest versions of classic games that people now in 30s and 40s used to enjoy when younger.

    “Switch looks very similar to the portable arcade games that people now in 30s and 40s first used in their childhood,” said researcher Jang Min-ji from Kocca. “As the generation that grew up with these games now has purchasing power, similar games are bought by people in that generation.”

    “Even younger people – those in their teens and 20s – who have never experienced these games, are finding Switch refreshing in that unlike smartphone and traditional console games, users can carry it around and play it while in bed, not to mention connect the games to television. Such charms of Switch have captivated people across age groups,” Jang said.

    The global newtro trend was evident at Consumer Electronics Show (CES), held in Las Vegas in early January. Though many people gathered to experience Sony’s state-of-the-art games with virtual reality and augmented reality, bigger crowds gathered at booths for classic games, like Street Fighter II and Double Dragon.

    “It has become a new trend for people in their 30s and 40s to reminisce about their past, while the younger generation fulfills their fascination for the newtro style,” said Kim Gyeong-geun, a merchandiser at a local toy seller, Toy Friends.

    Growing tired of mobile games

    Another key contributor to the growing demand for classic games is the gradual loss of interest in mobile games, which dominated the local market over the past several years. Players are growing tired of the free-to-play model, which is employed by the majority of mobile massively multiplayer online role-playing games (Mmorpg).

    With free-to-play mobile games, players can download the game either for free or at a low price, but they are compelled to spend more to improve the gaming experience.

    In a report on the success of Switch, Lee Taek-su from KB Research wrote, “In the past, most people did not agree with the idea of spending money on console game software that costs between 50,000 won [$44.40] and 60,000 won, since they could easily play mobile games for free or for around 1,000 won to 2,000 won. But as a growing number of players start to have the experience of spending much more cash on mobile games, their perceptions have started to change.”

    The diversity of games that could be interesting to people of different ages and gender, and the fact that these games can be enjoyed by multiple people at once through the connection of hardware, are few reasons Switch is gaining popularity.