Latest news with #CCI
New Indian Express
16 hours ago
- Business
- New Indian Express
Predatory pricing: Bus operators in Kerala move CCI
KOCHI: A relentless price war has erupted on long-distance routes, including the heavy-demand Kochi-Bengaluru section, as a wave of new entrants, mainly international and national brands, rolled in of late, challenging established players with slashed fares and aggressive promotion. Now, the complaints of 'unfair and predatory pricing' have reached the doorsteps of the Competition Commission of India (CCI), after the Bus & Car Operators Confederation of India (BOCI) took up the issue with Union Minister of Road Transport and Highways Nitin Gadkari. 'It has come to our attention that new entrants in the market, including international brands such as FlixBus, have begun operations in India under the guise of start-ups, and are adopting predatory pricing practices. These companies, backed by substantial financial reserves, are offering fares as low as Rs 99 and Rs 199 for long-distance routes exceeding 500 kms,' the BOCI said in the complaint. Pointing out that the CCI guidelines prevent an industry from quoting prices below a viable operational threshold, the BOCI further charged that 'certain foreign companies' are deliberately adopting such strategies that are detrimental to the domestic bus industry. 'International brands like FlixBus and redBus resort to this practice in the Kochi-Bengaluru sector. They are charging fares half of that of what the STC (State Transport Corporation) charges. They offer tickets for as low as Rs 899 when the STC charges around Rs 1,600.
Fibre2Fashion
18 hours ago
- Business
- Fibre2Fashion
Long-term prospects of India's textile industry seem strong: Report
The long-term prospects of India's textile industry seem strong as channel inventories seem to be normalising at the global retailer level, the United States may raise tariffs for China, labour costs are rising in Vietnam and Bangladesh is seeing political instability, according to a report by Systematix Research. Indian companies may pass on part of rise in costs to consumers, potentially leading to higher prices for textiles and apparel. This could dampen demand in key markets like the United States. Nevertheless, larger macroeconomic trends are beginning to tilt in India's favour, positioning it as a more appealing sourcing hub for global retailers, said the report. The Indian textile industry's long-term prospects seem strong with normalising global retail inventories, probable US tariff rise for China, rising labour costs in Vietnam and Bangladesh's political chaos, Systematix Research said. Indian textile-apparel prices may rise. Stable cotton prices, favourable forex rates and operational efficiency may bolster Indian firms' profitability in the long run. However, Indian textile firms have reported a lacklustre performance in the fourth quarter of fiscal 2024-25 (FY25). Revenue of such firms witnessed a modest 5-per cent growth year on year (YoY), while earnings before interest, taxes, depreciation and amortisation (EBITDA) declined by 3 per cent, and profit after tax only slightly increased by 3 per cent YoY, primarily due to ongoing tariff uncertainties and weak sales volumes. Spinning companies experienced a slight improvement in gross margins because of falling cotton prices and steady yarn prices, while garments benefitted from normalised retailer inventories, boosting sales volumes, the report noted. In contrast, India's home textiles segment continued to experience reduced demand, with significant volume declines when compared YoY and quarter on quarter. However, stable cotton prices and favourable foreign exchange rates, along with continued focus on operational efficiency, are expected to bolster profitability for Indian textile companies in the long run, it observed. Systematix Research expects the prevailing cotton-yarn spread of 0.70 per pound to sustain and the Cotton Corporation of India (CCI) to remain as the sole supplier of cotton, unless the government decides to waive off the import duties on cotton. Fibre2Fashion News Desk (DS)
Fibre2Fashion
a day ago
- Business
- Fibre2Fashion
CAI revises 2024â25 cotton output to 301 L bales, seeks policy reforms
The Cotton Association of India (CAI) has further raised its cotton production estimate to 301.15 lakh bales of 170 kg for the current 2024–25 season (October–September). In its April 2025 report, it had projected production at 291.35 lakh bales. India's cotton production last year stood at 327.45 lakh bales. The region-wise analysis shows that cotton production in north India may fall to 28.80 lakh bales this season from 45.62 lakh bales. In central India, production is expected to reach 180 lakh bales, down from 202.21 lakh bales last year. However, cotton production in south India may rise to 86.50 lakh bales from 73.85 lakh bales, CAI said in a press statement. CAI has raised its 2024â€'25 cotton production estimate to 301.15 lakh bales. Output is set to decline in the north and central regions but rise in the south. Consumption and exports are expected to fall, while imports may more than double. CAI flagged rising MSPs as a threat to competitiveness and urged reforms, including changes to CCI's sales policy and a Bhavantar-like scheme. Cotton stock is projected to be 48.34 lakh bales at the end of the current season, compared to 30.19 lakh bales last year. The country's cotton consumption may decline to 305 lakh bales from 313 lakh bales in the previous year. Cotton exports are also expected to fall to 17 lakh bales from 28.36 lakh bales last season, while imports may rise two-and-a-half-fold to 39 lakh bales from 15.20 lakh bales. CAI stated that the continuous increase in minimum support prices (MSP) for cotton is causing concerns. Higher MSPs not only distort market dynamics and hinder the natural price discovery process, but also raise production costs for textile mills, potentially leading to higher consumer prices and negatively impacting the global competitiveness of Indian cotton. As this poses a threat to the survival of the entire value chain, stakeholders emphasised the need for an equitable solution that continues to provide remunerative prices to farmers without compromising the competitiveness of trade and industry. Several suggestions were made during the meeting, including the introduction of a Bhavantar-like scheme and revisions to the Cotton Corporation of India (CCI) sales policy. Suresh Kotak, chairman of the Textile Advisory Group and chairman of the Kotak Group of Companies , appreciated the stakeholders' concerns and acknowledged the need to revise the MSP structure and CCI sales policy. He noted the suggestions and stated that he would take them up with the government. Fibre2Fashion News Desk (KUL)
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Business Standard
2 days ago
- Business
- Business Standard
Dentsu India admits to being CCI whistleblower in ad cartel investigation
Japanese advertising company Dentsu's Indian arm has admitted to being the whistleblower in the Competition Commission of India's (CCI's) ongoing investigation into alleged collusion between media buying agencies and top broadcasters to fix advertising rates in the country. 'Dentsu India is among the country's leading agency networks, and with that comes the responsibility to act with integrity and accountability. We had a choice — to remain passive or drive change,' a spokesperson for Dentsu India said in an emailed response to Business Standard. 'In February 2024, we proactively approached the CCI suo motu under its leniency framework. This was not a reaction to external pressure but a decision to support reform from within.' The statement comes months after the CCI conducted raids at media buying agencies, including GroupM, Dentsu, Madison, and industry body the Indian Broadcasting and Digital Foundation (IBDF), following allegations of cartel-like behaviour between agencies and broadcasters to manipulate ad pricing. According to media reports, the March raids were carried out at nearly 10 locations and also included other major agencies such as Havas, as well as associations like the Advertising Agencies Association of India (AAAI) and the Indian Society of Advertisers (ISA). 'This may be a challenging moment for an industry we are proud to be a part of, but it also presents an opportunity for collective reform. At Dentsu India, we are committed to this change — for our clients and the future of a thriving industry,' the company said. Sources familiar with the development said the competition watchdog had used whistleblower input to gather evidence on alleged cartelisation among media buying agencies ahead of the Indian Premier League (IPL) season. The CCI has not officially confirmed the reason for the raids. The method of information gathering referred to by Dentsu — the 'leniency programme' — allows whistleblowers within a cartel to disclose information about the operation in exchange for reduced penalties in mitigating circumstances. Regulators often use such frameworks in cartel cases due to the difficulty of obtaining evidence in secretive arrangements.
NDTV
2 days ago
- Business
- NDTV
How The World's Top Ad Agencies Aligned To Fix Prices In India
New Delhi: Omnicom Media's India chief was frustrated. It was October 5, 2023 and a rival was trying to poach the U.S. firm's client by offering lower prices, just weeks after global advertising agencies and broadcasters struck secret pacts on ad rates in the South Asian country. The attempt to woo the client violated the agencies' agreement, Omnicom Media's India CEO Kartik Sharma wrote in a WhatsApp group comprising a who's who of advertising, according to excerpts of the discussion documented by antitrust investigators and verified by Reuters. "This kind of practice is not in the spirit of what we are collectively trying to achieve," Sharma wrote, without identifying the parties. Shashi Sinha, then India CEO of New York-based IPG Mediabrands, suggested an industry group should "admonish the agency". The exchanges form part of a confidential dossier compiled by India's antitrust watchdog that chronicles how global advertising companies, including leading U.S. and European firms, coordinated to rig prices in the world's most populous nation. Reuters reviewed evidence from the Competition Commission of India (CCI) investigation, including a 10-page document with messages and records of meetings between top advertising executives, and two industry agreements under scrutiny for antitrust violations; and interviewed two people familiar with the probe. The key details, which haven't been previously reported, centre on WhatsApp interactions involving 11 industry executives. They include the top India or South Asia executives of WPP's GroupM; U.S.-based Omnicom Media and Interpublic's IPG Mediabrands; France's Publicis and Havas Media; Japan's Dentsu and India's Madison World. Over WhatsApp and in meetings, the executives coordinated responses to clients, which "resulted in alignment of competing advertising agencies," CCI officials said in the August 9 dossier, determining on an initial basis that the conduct contravened competition law. The firms agreed to cooperate on pricing, including not to undercut each other; colluded with broadcasters to deny business to agencies that didn't comply; and discussed financial terms involving at least four Indian clients over conference calls, according to the investigation documents. The documents don't indicate whether the agencies' foreign headquarters were aware of the executives' actions. A spokesperson for WPP Media, which until May was known as GroupM, told Reuters it was aware of the investigation but declined to comment further. A Dentsu India spokesperson confirmed Reuters reporting that it had disclosed industry practices to the CCI in February 2024 under the regulator's leniency program, which enables lesser penalties for firms that share evidence of malpractice. The spokesperson didn't address specific evidence raised in the dossier but said the firm had implemented stricter audits and controls. The other agencies and their executives didn't respond to Reuters questions about the antitrust probe and information in the dossier. The regulator also didn't respond to queries. Reuters has reported that in March, as part of the continuing investigation, the regulator raided the Indian offices of many advertising firms and an industry group that represents broadcasters, including the Reliance-Disney venture and Sony. CCI investigations typically take several months. The regulator can't press criminal charges, but can impose financial penalties on the media agencies of up to three times their profit or 10% of an Indian entity's global turnover, whichever is higher, for each year of wrongdoing. SECRET PACTS WPP Media, the world's largest media buying agency, last year - when it was still known as GroupM - won new India business worth $447 million, followed by Omnicom's $183 million, according to research firm COMvergence. But India's near-$30 billion media and entertainment sector is grappling with weak consumer sentiment. Ad spending will rise 7% to $19 billion in 2025, the slowest growth in three years, according to GroupM estimates. The CCI is investigating the role of two industry bodies, the Advertising Agencies Association of India (AAAI) and the Indian Broadcasting & Digital Foundation (IBDF), in orchestrating the suspected cartel. The former group is led by WPP Media India head Prasanth Kumar, while the broadcasting body's president is Kevin Vaz, a top Reliance-Disney venture executive. Neither industry group responded to requests for comment. The dossier shows the AAAI circulated guidelines to ad agencies in August 2023: They must charge clients whose annual spending exceeds $29 million a minimum 3% commission for digital ads and 2.5% for traditional media. Lower-spending clients would pay higher minimum commissions of up to 8%. A month later, the industry associations entered a joint pact, agreeing no agency would "unilaterally offer any discount" on rates while pitching for business. The pact, reviewed by Reuters, declared its aim was to eliminate "lower pricing as a reason to award a pitch". The advertising firms began coordinating their activities at least as early as August 2023, according to the CCI documents. Ad executives who met on December 1 that year hailed their collaboration as a "great success" and resolved to continue, according to meeting minutes cited in the CCI's evidence. 'ALL ALIGNED' In the U.S., the Federal Trade Commission this month sought information from advertising agencies as part of a probe into whether they coordinated boycotts of certain sites. The Justice Department in 2016 probed agencies it suspected of rigging bids to favour in-house units, but eventually closed the case without bringing charges. Brewer Anheuser-Busch InBev used CCI's leniency program to blow the whistle on an industry cartel in India in 2017. In the case of the ad industry, Dentsu India told Reuters it filed its leniency application with the CCI not as a reaction to external pressure but out of a decision to "support reform from within". Two people with knowledge of the matter told Reuters the evidence Dentsu submitted included a transcript of the WhatsApp group. The group, formed in August 2023 and reviewed in part by Reuters, was named "AAAI media agencies" and contained scores of chat messages. Participants included Kumar of WPP's media company, Sharma of Omnicom Media, IPG Mediabrands' Sinha, Havas Media India CEO Mohit Joshi, Dentsu South Asia CEO Harsha Razdan and then-media business CEO Anita Kotwani, Publicis South Asia chief Anupriya Acharya and Madison boss Sam Balsara, the investigators' evidence shows. Members of the group discussed advertising pitches and coordinated on interactions with clients such as food delivery giant Swiggy, drug maker Cipla, SoftBank-backed e-commerce firm Meesho, and Kshema Insurance. In Swiggy's case, the AAAI arranged a Zoom call with media agency heads to discuss the company's advertising pitch. Later, GroupM's Kumar, as AAAI president, suggested an email response to Swiggy explaining the industry's agreed position on rebates. "Ok all aligned thanks," he wrote after a consensus emerged. Kshema told Reuters the insurer was unaware of the matter. The other clients didn't respond to questions. During another discussion on client rebates, an unspecified Dentsu executive told rivals over WhatsApp that "the lowest we go to is retain 30% and 70% we pass back to the client," according to the CCI dossier. CCI officials noted in the document that advertisers and the broadcasters' group had sought to penalise enterprises that didn't comply with the pricing pacts. In an email to Walt Disney in August 2023, Kumar wrote that broadcasters should refrain from granting business to a firm that had breached the pacts, ITW Consulting, though he said it had later agreed not to approach clients directly. ITW didn't respond to Reuters questions. Tensions heated up again over WhatsApp three months later. Sharma, of Omnicom Media, learned that ITW had done another "direct deal with a client of ours" for advertising on streaming platform Hotstar, which was run by Disney. This irked Sharma, as Hotstar had the rights for the cricket World Cup held in India at the time. "This nuisance has to stop," he wrote in the group.
