$3 billion of foreign capital in casinos, GDP up by 0.58%, research

VietNamNet Bridge - If foreign investment in the casino business increases by about $3 billion compared to the current level, Vietnam’s GDP will rise by 0.58% in the first year, according to research conducted by the Institute for Regional Sustainable Development (IRSD).

Illustrative image. Photo: Dan Tri

The research indicates that the gambling industry and legal casinos can bring about significant benefits, such as an increase in budget revenue, creation of employment and improvement of income of local workers, attraction of investment and tourists, strengthening of trade and reduction of flow of foreign currency.

According to the research, if foreign investment in the casino industry increases by about $3 billion compared to the current level, Vietnam’s GDP will increase by around 0.58%.

The researchers also said that sociological findings indicate changes in people's perceptions about the gambling industry and casinos, with 71% of respondents saying that if casinos are open to Vietnamese people, they will attract many players; 64.7% say the gambling industry will help increase budget revenue; 47.4% have a positive view on the creation of employment by the casino industry; and 46.2% say they will have a positive influence on investment attraction.

Dr. Nguyen Dinh Chuc, IRSD Deputy Head, said the research also indicates the possible social impact of this industry such as reduction of labor productivity, increase of organized crime and family problems, indebtedness, and bankruptcy. However, the social impact is not always negative, and international experience has shown successful control measures. 

In Vietnam, the gambling industry in general and casinos in particular are managed strictly. There are 64 lottery companies, eight casinos, two places for sports betting, and 43 centers of bonus electronic game in the country. Casinos and electronic gambling points are only open to foreigners.

As reported by the Ministry of Finance, last year the lottery business earned revenue of VND64 trillion, and paid taxes of approximately VND20 trillion. For casino business, revenue in 2014 reached VND1,379 billion and tax revenue was VND336 billion.

There are no official statistics for illegal gambling activities but according to reports from the Ministry of Public Security, 345 people were arrested last year for gambling, with the total money for gambling reaching more than VND10,000 billion.

IRSD’s survey in Tay Ninh province showed that on average about 200 Vietnamese people crossed the border to Cambodian casinos. The number increased to 700-800 people/day during the weekend.

Annual revenue of Cambodian casinos is estimated at around $250 million, and the majority of players are Vietnamese.

"Actually, gambling and casino management in the form of prohibition is becoming inefficient because it cannot help prevent illegal gambling activities and causes a budget deficit. Meanwhile, Vietnamese people are free to gamble in the casinos in Cambodia. It means that Vietnam still needs to manage all of the negative effects from operation of casinos but it does not earn any benefits," Chuc said.

Chuc said that, based on the findings, the researchers proposed that Vietnamese players would be allowed to participate in some types of gambling and bonus games in large-scale resorts in places located far away from densely populated urban areas.

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More foreign bankers to set foot in Vietnam

VietNamNet Bridge - The ASEAN Economic Community (AEC), in which member countries will open up to 70 percent of their banks to foreign investors, is believed to pave the way for more and more bankers to seek business opportunities in Vietnam.

Dr. Can Van Luc from the Bank for Investment and Development of Vietnam (BIDV) believes that many new banks will join the Vietnamese market by the end of 2015 or early 2016.

Vietnam, a member of AEC, will have to accept foreign ownership ratio of up to 70 percent in Vietnamese banks, much higher than the ceiling foreign ownership ratio of 30 percent applied to bankers from other regions. 

The foreign ownership ratio will be a maximum of 49 percent in insurance and securities companies.

“This is why I strongly believe that more foreign banks will come to Vietnam in 2016,” Luc said.

The Vietnamese finance & banking market received one more foreign member when Public Bank Berhard (PBB) from Malaysia, a joint venture bank with BIDV, shifted to become a 100 percent foreign owned bank.

The PBB’s decision has raised the number of operational foreign banks in Vietnam to six. There are also 43 foreign bank branches and 49 foreign bank representative offices now operational in Vietnam.

Infornet quoted Ms. Nguyen Thuy Duong, Partner of Ernst & Young Vietnam (EY Vietnam) as saying that number of foreign banks in Vietnam will be increasing after AEC is established by the end of the year.

“Foreign bankers are eyeing the Vietnamese market and they are just awaiting the official admission tickets,” she said.

An analyst noted that South Korean and Indian banks are attempting to penetrate the Vietnamese market.

According to Luc, the 70 percent foreign ownership ratio principle will be valid as soon as AEC forms. However, with the ASEAN Minus X principle, some less developed economies would follow specific integration process, which means that Vietnam may not have to accept the maximum 70 percent foreign ownership immediately.

This means that Vietnam can open its banks step by step, by 40 percent, 50 percent or 60 percent, depending on the government’s negotiations.

In fact, many foreign bankers have been trying to “take a shortcut” to Vietnam by buying shares of Vietnamese operational banks. However, no successful deals have been reported recently. 

According to Luc, many negotiations failed because the involved parties could not reach agreements on business valuation. This is partially because Vietnam still lacks independent business valuation firms. 

Luc also said it was necessary to simplify administrative procedures, emphasizing that complicated procedures will discourage investors, who want to wrap up deals quickly to avoid missing opportunities.

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Pharma Sector's Struggle To Tighten Standards Paves Way For M&A Deals

India's smaller generic drugmakers, struggling to cope with a bruised reputation and tougher regulation in the United States, are under pressure to consider branching out to new, less-profitable markets or sell out to larger rivals.

Two years after its most high-profile regulatory setback to date in the United States - Ranbaxy's $500 million US fine for drug safety violations - India's $15 billion a year generic drug industry is still rebuilding its image in its biggest market.

Many of its top firms are facing sanctions at some of their factories, as the US Food and Drug Administration (FDA) tightens checks and its approvals process.

Combined with government-mandated price controls on drugs at home, that is piling pressure on smaller players.

"If they want to have a presence globally, they have to make investments. If they can't, then they'll have to focus on other markets or scale back their ambition outside of India, and that's probably what will happen," said Subhanu Saxena, CEO of Cipla, India's fourth-largest drugmaker by revenue.

Ashok Anand, president of Hikal Ltd, a Mumbai-based drugmaker with a market value of $167 million, said some peers were putting themselves on the block.

"If they cannot deal with the stricter regulations, they might just prefer to sell out," he said.

Pressure on US sales has been felt across the Indian industry, with all drugmakers hit by delays in FDA approvals as the US safety body overhauls its review process. Growth in US revenue for drugmakers slowed to 14 per cent in the year to March 2015, less than half what it was in the year to March 2012, according to brokerage Edelweiss.

But for larger players who want to plug gaps or, for the likes of Glenmark and Aurobindo who aim to grow in theUnited States, this pressure has lowered prices and could pave the way for attractive deals, bankers said.

"Now that some of the smaller companies are reeling under intensive regulatory scrutiny and want to cash out on their investments, valuations would be much more realistic," said the head of India M&A at a large European bank in Mumbai.

Spending Spree
Indian manufacturers say they have spent millions in high-end testing equipment, improved training and have hired larger teams in quality control since Ranbaxy was fined for manipulating clinical data.

Some consultants estimate spending on compliance has more than doubled to reach about 6 to 7 per cent of sales for the larger companies.

But while the number of US export bans issued to Indian companies fell to eight in 2014 from 21 in 2013, according to FDA data, the agency continues to find manufacturing violations at the plants of some of the biggest drugmakers in the country, an indication of the pervasiveness of the problem.

Sun Pharmaceutical Industries, Wockhardt, Dr Reddy's Laboratories and Cadila Healthcare have all faced FDA rebukes over the past year.

Smaller firms Ipca and Aarti Drugs faced FDA bans on their plants this year.

These failures - which executives blame on India's "quick fix" culture and consultants blame on a failure to prioritise compliance - have clouded short-term growth prospects and added to pressure on smaller players, pushing some to look elsewhere.

"They can choose to be in lesser-regulated markets, such as Latin America, where there is a lot of demand. But they will have to live with much thinner margins," said the finance director of a small Indian drugmaker, who did not want to be named. "It's survival of the fittest."

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Home | Laptops | Laptops News Ethernet Switch, Router Market in India Sees 20 Percent Growth: IDC

The ethernet switch and router market in India has seen a 20 percent year-on-year growth, the International Data Corporation (IDC) said on Monday.

Calendar year 2014 was one of the best years for the networking market (local area network and wireless local area network included) in India with over 20 percent growth year on year, it said in a report released here, adding that a similar pattern is expected in 2015 which will draw boost from government initiatives and organisations willing to invest in future technologies.

"Government initiatives and increasing adoption of third platform by the enterprises is pushing the need for smart network solutions that can sustain the growth of unstructured network traffic. Upcoming verticals like e-commerce, healthcare and hospitality along with traditional ones are expected to drive future investments," said Gaurav Sharma, research manager, enterprise computing,IDC India.

The ethernet switch market clocked end-revenue of $124 million (roughly Rs. 787 crores) during the first quarter of 2015, with a slight decrease quarter on quarter (-0.8 percent) but an impressive growth of 15.1 percent year on year.

The router market stood at a total of $69.4 million (roughly Rs. 441 crores), dipping 13.6 percent year on year and three percent quarter on the quarter.

According to IDC, organisations are increasingly taking interest in the third platform technologies to leverage its benefits in workforce optimisation, supply chain, customer experience and efficient resource utilisation.

It also said that the IP-based security-surveillance market is also likely to take a faster route giving vendors, small or big, an opportunity to grow.

Further, the small and medium businesses (SMBs) are likely to offer similar growth to the market and the verticals, like any other traditional segment to benefit from mobility and network optimisation solutions, it added.

According to the report, Cisco retained its dominance in the switch and router market, increasing its revenue quarter on quarter as well as year on year

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Puma top global lifestyle brand in India

German sporting lifestyle major Puma has quietly emerged as the top international brand in India by revenue, upstaging its direct rivals like Adidas and fashion apparel names such as Benetton and Zara, according the regulatory filings.

BENGALURU: German sporting lifestyle major Puma has quietly emerged as the top international brand in India by revenue, upstaging its direct rivals like Adidas and fashion apparel names such as Benetton and Zara, according the regulatory filings.

The local operations of Puma SE, part of the French luxury goods conglomerate Kering now, reported domestic revenue of Rs 766 crore during the calendar year 2014, showed the company's filings with Registrar of Companies last week. This was ahead of Adidas (Rs 719 crore), Nike (Rs 624 crore), Benetton (Rs 594 crore), Levi's (Rs 599 crore) and Zara (Rs 580 crore) in FY14.

Puma follows calendar year for reporting business numbers, while most of the other brands like Benetton and Zara follow April-to-March financial year, and their latest numbers are not yet in public domain. A recent media report said Zara reported Rs 721 crore and Benetton is said to have clocked Rs 802 crore in FY15. Puma, growing at about 30% in the first six months, is on pace for Rs 900 crore revenue this calendar year. Puma will be marginally trailing homegrown Madura Fashion & Lifestyle's Louis Phillipe in the overall brand sweepstakes by company revenue.

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Vietnamese users prefer low-cost tablets: GfK

About 582,000 tablets were sold in Viet Nam in the first five months of the year, registering a 34 per cent year-on-year increase, GfK market research agency said.

Apple's iPad Mini Wifi 16GB with a 7.9 inch screen. Vietnamese customers have a high demand of low-cost small-screen tablets in the first five months of the year, GfK market research agency said. Photo thegioididong.com

In a report released on July 6, GfK said the growth was fuelled by high demands for low-cost small-screen tablets.

As many as 76 per cent of the tablets were priced lower than US$300, compared with 50 per cent during the same period last year. In the high-end segment, tablets costing more than $500 accounted for 14 per cent, compared with 29 per cent in the same period last year.

In the middle segment, tablets costing $300 to $500 comprised 11 per cent of the sold units, marking a 11 per cent year-on-year fall. The number of brands in the Vietnamese tablet market dropped from 56 to 49.

Customers preferred tablets with screens measuring 7.9 inches or smaller. Seven out of 10 tablets sold during the period were of this segment, higher than that in 2014.

GfK Vietnam Managing Director Tran Khoa Van said the tablet market would witness higher sales in the third quarter with many promotions to be offered on the occasion of the opening of the school year in September. He said the sales of tablets this year might reach about 1.9 million units.

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Chronic constipation affecting urban India's quality of life: Survey

• IANS, Kolkata
| 
• Updated: Jun 17, 2015 22:04 IST

FMT involves the delivery of stool from a healthy pre-screened donor to a person with gastrointestinal conditions associated with changes in the gut flora. (Shutterstock)

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Bhaskor Banerjee had a tough time dealing with it in Piku, but in reality, chronic constipation has significantly affected urban India's quality of life, a survey claimed on Wednesday.

Chronic constipation significantly impacts people's quality of life due to lack of sleep, and mental and physical stress, compared to those who do not have constipation, according to the "Gut-Health Survey".

It said 14% of India's urban population suffer from chronic constipation, an inability to pass stool for more than three times a week and for more than three months at a stretch.

The findings showed 60% of people with chronic constipation opted for home remedies as the most preferred treatment option for relief.

However, half the people who self-medicate eventually visited a doctor for cure, said the survey.

Irritability, lack of interest in work, mood swings, worry and embarrassment were the most common effects, noted among 3,500 individuals across six Indian cities - Mumbai, Delhi, Lucknow, Kolkata, Hyderabad and Coimbatore.

The findings highlighted that incidence of constipation was higher in India than the worldwide average of 10%.

Leading causes for constipation were significantly higher frequency of eating non-vegetarian food, low water intake, snacking and eating fried, oily, spicy, junk and processed food.

The survey said: "Three out of four people with chronic constipation said it leads to other medical problems/complications with piles and haemorrhoids, ulcers, abdominal pain and anal fissures as the leading issues."

"While the relief to this nagging issue is easy, people with constipation generally try out multiple self-medication options and come to a doctor only after the issue has become chronic.

"Untreated constipation can lead to complications like faecal incontinence, haemorrhoids and anal fissures. Greater awareness, timely action, lifestyle modifications and eating right can help people lead a healthy and active life," said Jyoti Ranjan Mohapatra, consultant gastrointestinal and liver diseases, associated with Peerless/Apollo Hospital.

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