Monday March 30, 2020

Know About the Impacts COVID-19 Has on India

As COVID-19 cases in India swell and its impact and recovery scenarios change by the day

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COVID-19
COVID-19 scenario is unprecedented -- high contagious rate (vs. earlier flus), large scale lockdowns and fear and panic due to digital connectivity. Pixabay

As COVID-19 cases in India swell and its impact and recovery scenarios change by the day, it is high time for the Indian government and authorities concerned to prepare for multiple scenarios — act now, prepare for near term and build for medium term, a new BCG report has said.

According to the report titled “COVID-19: India Perspective,” three potential scenarios could emerge – Rapid recovery (V) or Slow comeback (U) or Protracted challenge (L) driven by evolving properties of the virus, containment and mitigation, treatment/vaccine development lead-time and policy and fiscal response. The number of coronavirus-affected people in India reached 360 on Sunday with reports of seven deaths.

“COVID-19 scenario is unprecedented — high contagious rate (vs. earlier flus), large scale lockdowns and fear and panic due to digital connectivity,” the report said. “Set up a rapid response office, safeguard people and customers, stress test the financials, manage revenue and demand, reconfigure supply chain, renew business planning and restructure, reposition and reimagine the business,” it added.

COVID-19
As COVID-19 cases in India swell and its impact and recovery scenarios change by the day. Pixabay

“It is time to establish a liquidity office to forecast cash flows and manage/mitigate risks, ensure rigorous, prudent cash management and governance and reduce non-critical uses of cash, assess the viability of current investment roadmaps and dividend policy and share repurchase plan, stress test cash-flow from financing/investing based on market scenarios and develop concrete action plans based on 3-5 medium term macro-economic scenarios,” the findings showed.

According to the report, it is necessary for the government to engage with shareholders and clearly communicate action plans to key stakeholders, revise target-setting and objectives (sales targets, production plans and related KPIs), re-define budgets and targets as frequently as possible and necessarily by geography/market/segment.

“Establish demand-side rapid response team to monitor marketing, sales and pricing implications, understand changing customer needs, assess 1st order impact, downside risks on revenues, customer pipeline, accounts receivables and optimize pricing and product offering to meet immediate consumer needs,” the report highlighted.

The companies need to “reach out to customers/distributors to understand their needs (e.g. provide credit line), craft new product and service story and create new selling points, cautiously select marketing channels during epidemic and look for new channels and new disruptive formats that work under epidemic,” said the report.

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New cases are being reported from several states now. Delhi has reported 27 positive cases, Telangana 21 cases, Rajasthan 24 while Haryana, 17 cases. The maximum are in Maharashtra, at 74, while Kerala saw a spurt on Sunday to reach 64. (IANS)

Next Story

Weakning Demand Caused by Coronavirus Pandemic To Impact Indian Smartphone Market

Some brands like Apple, Samsung, Xiaomi, Realme, OPPO, Nokia HMD and Lava have already set up services on top of the active user base

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Smartphone
Some brands like Apple, Samsung, Xiaomi, Realme, OPPO, Nokia HMD and Lava have already set up services on top of the active user base. Pixabay

More than the supply concerns, weakening demand due the uncertainties brought about by the novel coronavirus is set to impact the India smartphone market the most, according to a projection by market research firm techARC.

During the calendar year 2020, demand is likely to be low particularly during the April-August period. “There can be no qualitative deterministic measurement of the impact done in this situation. There are so many uncertainties around and the situation is impacting both the supply and the demand side of the market,” said Faisal Kawoosa, Founder and Chief Analyst, techARC.

“We expect supply chain to resume in June in India. Thus April and May will be the worst affected months in terms of shipments, be it out of China or in India,” Kawoosa added. What is more worrying is the weakening demand as consumers are now focusing on spending their money only on essentials like food and medicine.

“Only those requiring a smartphone in case of breakdown will be the primary buyers. The elective upgrades and replacements will be at minimal,” said Kawoosa. Supply, including the channels (offline as well as online) should be back to normal in September. This will be fundamentally triggered by ground-up to festive season.

Smartphone
More than the supply concerns, weakening demand due the uncertainties brought about by the novel coronavirus is set to impact the India smartphone market the most, according to a projection by market research firm techARC. Pixabay

But even during the October-December quarter, demand could be lukewarm due to the the macro-economic scenario by then as well as fear of the viral infection resurfacing towards the winter. “Only if, there would be a vaccination available by then at mass scale, the market could see revival, but not at the normal levels,” Kawoosa said, adding that the smartphone industry will have to look at other revenues, especially service-oriented offerings, to offset the gap which will arise due to low sales of smartphones in 2020.

Some brands like Apple, Samsung, Xiaomi, Realme, OPPO, Nokia HMD and Lava have already set up services on top of the active user base.

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“They need to further look for more paying services to narrow the gap between the potential earnings through sale of hardware and the actual revenues they can realise in 2020,” said the report. (IANS)