Indian IT firms wait and watch on Ukraine; SIAC rejects Ashneer Grover’s plea

By Kevin Colleran On Feb 28, 2022

India’s IT services firms, which don’t have a significant presence in Ukraine, have decided to adopt a wait-and-watch approach to the crisis and have activated business continuity plans in Eastern European countries such as Hungary, Poland and Romania. An estimated 50,000 tech workers and 200,000-odd tech freelancers in Ukraine could be affected by the crisis, according to research firm ISG.

Also in this letter:
■SIAC rejects Grover’s plea against BharatPe review
■Bhavish Aggarwal’s struggle to build a super app for Ola
■Indian IT firms face a diversity challenge

Indian IT industry in wait-and-watch mode on Ukraine

As the Russia-Ukraine crisis escalates, India’s information technology and business process management industry has gone into wait-and-watch mode.

Though Indian IT companies don’t have large operations in Ukraine, they have big centres in Eastern European countries such as Hungary, Romania, Poland and the Czech Republic, where business continuity plans are being activated.

According to research firm ISG, about 50,000 tech workers and 200,000-odd technology freelancers in Ukraine could be affected by the crisis, and in turn affect operations of tech companies around the world.

ISG has also warned companies of disruptions due to cyberattacks. “Cyber risk outside Ukraine has increased significantly over the past 48 hours… All enterprises should be prepared, whether they use Eastern Europe as a technology delivery location or not,” it said in its advisory.

Who’s doing what: HCL Technologies said it is closely monitoring the situation in delivery centres in the region. “We have been monitoring the situation closely and have already activated the required business continuity measures,” said a spokesperson.

IT industry body Nasscom told us it was in constant touch with its members to understand the impact of the Ukraine crisis. It said initial feedback indicated no immediate impact.

Sheltering in place: In a note on the Ukraine crisis on Saturday, ISG said: “…based on discussions over the past 48 hours, it’s our view that while some IT services employees have left the country, most are sheltering in place. This is likely to remain the situation for the near term as the Internet has been disrupted, many roads are blocked, and air space has been closed to commercial air traffic.”

Google bans RT app in Ukraine: Meanwhile, Google has banned downloads of Russian state-owned media outlet RT’s mobile app on Ukrainian territory at the request of the government in Kyiv.

Ukraine raises millions in crypto: Ukraine’s government has raised almost $8 million in cryptocurrencies after posting appeals on social media for donations of bitcoin and other digital tokens, according to blockchain analysis company Elliptic.

SIAC rejects Ashneer Grover’s emergency plea against BharatPe review

BharatPe’s Ashneer Grover seeks indemnity from future action as part of exit settlement

The Singapore International Arbitration Centre (SIAC) has rejected BharatPe cofounder Ashneer Grover’s emergency plea to stop a “governance review” that is looking into allegations of financial irregularities at the fintech company, three sources told us.

In an order passed on Friday, the arbitration body said Grover’s claims that the governance review was undertaken in an unfair manner held “no merit”, the people said. The SIAC also said BharatPe’s shareholder agreement did not offer “any relief whatsoever” to Grover from internal investigation.

Catch up quick: Grover, represented by law firm Karanjawala & Co, moved the SIAC earlier this month, seeking an emergency relief from the review, which started in January. He also sought to dissolve the current investigation committee and set up a new one.

BharatPe’s board had hired independent consultant Alvarez & Marsal (A&M) to look into the company’s internal processes.

Grover’s argument: In his emergency plea, Grover had alleged that the internal investigation gave him no chance to present his case, and was aimed at tarnishing his reputation and removing him as a shareholder of the company.

But SIAC has said in its ruling that any decision it made would be premature, given that the findings of the governance review have not been finalised. “Further, it is in the board’s power to call for a governance review within a company,” said one of the people ET spoke to.

Grover can appeal against SIAC’s order.

Talks continue: Meanwhile, settlement talks between Grover and BharatPe’s board continue. We reported on February 22 that Grover had sought indemnity from any future action against him as a part of the ongoing talks.

The same day, BharatPe sacked its head of controls Madhuri Jain, who is also Grover’s wife, accusing her of “misappropriation of funds”. It also cancelled her stock options.

TWEET OF THE DAY

Bhavish Aggarwal’s struggle to build a super app for Ola

Hailing cabs can be quite a humdrum exercise. For Bhavish Aggarwal, CEO and cofounder of Ola, the very business of ride hailing has never been enough. This time, though, his aggressive attempts at expansion and diversification come ahead of its much-publicised initial public offering (IPO).

In late January, for instance, Ola said it was going to set up 500 dark stores to expand its nascent quick-commerce business Ola Dash. This could make it the largest network of dark stores — neighbourhood distribution centres that facilitate delivery of products under 30 minutes — in India.

It is not just cabs that you can hire on Ola’s app. You can buy food and groceries through Ola Dash, and there’s also a link to buy the S1 electric scooter built by Ola Electric.

What’s cookin’? If this smells like the beginning of a super app, that’s because it is. Former executives we spoke to confirmed that there have been multiple discussions at the senior level to turn Ola into a super app as growth in the core business is hard to come by. Aggarwal reportedly wants to position Ola as a super app in the run-up to the IPO.

Many biggies, including Reliance and Tata, are trying to build a super app. But Ola’s inspiration, according to a source, is the Indonesian giant Gojek. Starting off with bike taxis, Gojek has built many services, from food delivery to ecommerce.

Could Ola’s new businesses — quick commerce and selling used cars — drive its future growth story?

Indian IT firms face a diversity challenge

Top-tier IT services providers may have been able to meet at least some of their stated gender diversity goals during the Covid-19 pandemic, but industry experts said that was clearly not enough as a massive talent crunch threatens to skew the ratio in favour of men going forward.

The $227-billion technology sector, they said, could pave the way for more women if they launch initiatives to close the gender gap, especially at mid to senior levels.

To be sure, the number of women at the top IT services providers has shot up to almost 35% of the total workforce as of the third quarter of financial year 2021-22, from 22% around four to five years ago, according to data from these companies.

Yes, but: When IT companies hire freshers, usually 50-60% of them are women, but this number dwindles higher up the corporate ladder, with women filling just 1% of top management roles across listed Indian organisations, according to industry experts.

IT firms are, however, looking to increase the number of female employees from the existing 30% to 45% in less than 24 months, showed a recent survey by professional services firm Aon, which tracked the 20 top IT services companies. Already, the number of women in these 20 companies is more than the India Inc average of 26%.

Also Read: ETtech Opinion | 200k women at TCS – time to raise a toast!

Startups to lease 29 million sq ft in 2022-24, says report

Startups are expected to lease about 29 million sq ft between 2022 and 2024, a 1.3X increase from 2019–2021, said a joint report by Colliers and CRE Matrix.

Large deals closed recently include:

Byju’s taking 3 lakh sq ft in Bangalore
Zomato leasing 2.75 lakh sq ft in Gurgaon
Spinny taking 1.5 lakh sq ft in Gurgaon

Fintech and logistics: According to industry experts, the demand will be led by fintech and logistics startups, which have seen their businesses grow rapidly amid the pandemic.

Growing needs: India has the 3rd largest startup ecosystem in the world, with 60,000 startups occupying more than 49.7 million sq ft of office space in the country.

According to the Orios Venture report, India saw 46 unicorns minted in 2021 alone, doubling the number of unicorns to 90. Indian startups raised a total of $42 billion in 2021, up from $11.5 billion in 2020. Today, one in every 13 unicorns globally was born in India.

Bengaluru still rules: While metro cities remain the main hubs for startups, more of these firms are setting up offices in non-metros like Jaipur, Indore, and Ahmedabad due to the low cost of living, reduced capital expenditure, and the-work-from-anywhere trend.

However, Bengaluru remains the top startup hub, with a 34% leasing share during 2019–21, followed by Delhi-NCR and Mumbai.

India among top 10 engagement markets for Spotify

India has become one of the top 10 engagement markets for Spotify, with the number of paid subscribers doubling in 2021, according to a top company executive.

Gustav Gyllenhammar, vice-president of markets and subscriber growth for Spotify Technology SA, said India has entered the “top echelon” of the company’s global markets. “It’s one of the most important markets we have there. It is a top 10 engagement market, and over the last year, we more than doubled our premium subscriber base here,” he said.

The company, which completed three years in India earlier this week, is still in investment mode here, he said.

According to Gyllenhammar, more than 150,000 playlists are being created every single day in India, which puts the country in one of the top 20 markets globally in terms of playlist creation.

Globally, advertising amounts to just 15% of Spotify’s overall revenue, but India and Indonesia are among the few markets where advertising contributes more to revenue than subscriptions.