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Also in this letter:
■ Flipkart launches 45-min grocery delivery in Bengaluru
■ Indian IT firms to hire 3,60,000 freshers in FY22: study
■ ElasticRun raises $330 million from SoftBank, others
China expresses serious concerns on India’s app bans
China on Thursday expressed serious concerns regarding India’s ban of Chinese apps for national security reasons.
“We hope India can take concrete measures to maintain the sound development momentum of bilateral economic and trade cooperation,” said Gao Feng, a spokesman for China’s ministry of commerce.
India blocked access to 54 Chinese mobile apps earlier this week. That was its fifth round of Chinese app bans since June 2020, when it banned 59 apps including the hugely popular TikTok. According to Reuters, 321 Chinese apps are now banned in India.
Apps banned in the latest round include Beauty Camera: Sweet Selfie HD; Rise of Kingdoms: Lost Crusade, Viva Video Editor and Tencent Xriver.
Rationale: India believes the apps were sending users’ data to servers in China. Such collection would allow the data to be mined, collated, analysed and profiled, potentially by “elements hostile to the sovereignty and integrity of India and for activities detrimental to national security,” a source told Reuters.
Yes, but: On Wednesday, we reported that many of the Chinese apps that India has banned since June 2020 continue to operate in the country, according to industry insiders and privacy experts. Some of these are registered in countries such as the US, Singapore and even India to evade bans.
Venus Dhuria, cofounder of mobile internet technology company AppyHigh, said these apps “quickly clone themselves, changing their identity and making basic tweaks to their design before returning”.
Huawei in the mix: China has also accused India of “suppressing” Chinese companies after Indian tax authorities raided the offices of Huawei on Wednesday. Gao Feng, a spokesperson for China’s commerce ministry, said on Thursday that China was “deeply concerned” about India’s “suppression of Chinese firms”.
Flipkart launches 45-min grocery delivery, to expand next month
Flipkart has started delivering groceries in 45 minutes in parts of Bengaluru through Flipkart Quick, which it had launched as a 90-minute delivery service in July 2020.
A source in Flipkart said the company was not overhauling its 90-minute delivery model, simply “optimising the steps” to reduce delivery times. Flipkart plans to expand the 45-minute service to more places next month, the source added.
Semi-quick commerce? This comes as so-called quick commerce firms such as Blinkit, Zepto, Swiggy’s Instamart and RIL-backed Dunzo are competing to deliver a range of products in 15-20 minutes.
Flipkart’s 45-minute grocery delivery service is in line with the company’s belief that 10-20 minute delivery isn’t the right model in the long term. Flipkart group CEO Kalyan Krishnamurthy had told ET on January 4 that the company would prefer to focus on a model that’s sustainable and offers both good value and selection.
“I don’t think that (15-20 minute delivery) is the right long-term customer model,” he had told ET. “We will look at a more sustainable business which offers it in 30-45 minutes with good value and selection. That is the way we look at the convenience business rather than force-fitting a consumer need which is actually not there in the market.”
Selection vs speed: Quick commerce companies such as Swiggy’s Instamart and Zepto operate dark stores to facilitate the delivery of groceries in 15-20 minutes. These dark stores typically have a stock-keeping-unit (SKU) of 1,000-3,000 products per store. Flipkart will have a wider selection since the company takes longer to deliver.
India leads on quick commerce: According to a report by Bernstein Research, India leads other global markets on quick commerce adoption. Quick commerce penetration as a percentage of online grocery is 13% in India, 7% in China, and 3% in Europe.
Quick commerce targets mid/high-income households in large metros, who seek convenience over price. But players across the sector are currently burning through money with no profit in sight.
Indian IT companies to hire 3,60,000 freshers in FY22: study
Indian IT companies are expected to hire about 360,000 freshers in fiscal year 2022, according to a study by cognitive intelligence platform UnearthInsight.
The findings: The study, IT Industry Q3 Insights & FY22 Forecast, also said there is likely to be an increase in attrition to 22-24% in Q4 from 22.3% in the previous quarter and 19.5% in the quarter before that. This is expected to fall to 16-18% in fiscal 2023.
- Mid-tier and small IT companies handed out an average wage hike of 8-12%, along with 15-20% for employee promotions for retention.
- IT services companies are set to post revenue growth of 19-12% in fiscal 2022, the highest ever for the industry.
Positive outlook: This growth momentum is expected to continue in FY23 and FY24 on the back of pricing, agility, and partnerships, the report said. The Indian IT services market is likely to hit $230 billion to $240 billion by fiscal 2022, largely driven by growth amongst the top 15 to 20 firms, it added.
Capgemini bets big on India: The country will play an even bigger role globally for the French technology company Capgemini in managing its business, said CEO Aiman Ezzat.
CEO speak: “We are increasing the number of account executives here as we believe India has a big role to play in managing our clients. We have grown the pool of executives and in the future see more Indian senior executives overall at Capgemini,” Ezzat said.
ElasticRun turns unicorn after raising $330 million from SoftBank and others
Business-to-business (B2B) ecommerce platform said that it has closed a $330 million funding round led by SoftBank Vision Fund 2 and Goldman Sachs Asset Management. The latest round also saw participation from Chimera and Innoven along with long-term investor Prosus Ventures.
The funds will be used for expanding into rural areas in several states and acquiring over one million kirana shop customers. ElasticRun will also use the fund to expand its services, like credit, nationally.
CEO speak: “Through the pandemic, our robust logistics and channel framework ensured uninterrupted supply and support to our rural kirana partners,” said Sandeep Deshmukh, CEO and cofounder of ElasticRun. “We have been growing at a rapid pace and are consistently expanding our store network across India.”
The latest round values the company at $1.5 billion, Deshmukh added.
ET reported on February 7th, citing regulatory filings, that the company tripled its valuation to become a unicorn after raising funds from SoftBank.
Other Done Deals
■ Social commerce grocery startup DealShare said it has raised $45 million from a subsidiary of the Abu Dhabi Investment Authority (ADIA) as part of a larger round. Other investors in the $210 million round, which it first announced on January 28, include Tiger Global, Dragoneer Investments Group, Kora Capital, Unilever Ventures, Alpha Wave Global. DealShare is now valued at over $1.7 billion.
■ Agrim, a business to business (B2B) platform for agri-inputs, said that it has raised $10 million in a funding round led by Kalaari Capital. The round also saw participation from existing investors Omnivore, India Quotient, and Accion Venture Labs. The startup plans to use this funding for talent acquisition, embedded fintech product development, and scaling up operations.
■ Ace Green Recycling, a battery recycling technology company, has raised over $7 million in a funding round led by Circulate Capital. Climate Angels also participated in the round along with angel investors. The startup has raised about $10 million to date, including this round.
Google plans Android privacy changes but promises to not be disruptive
Google said that it was working on privacy measures meant to limit the sharing of data on smartphones running its Android software. But the company promised those changes would not be as disruptive as a similar move by Apple last year.
Google did not provide an exact timeline for its changes but said it would support existing technologies for at least two more years.
Apple bites advertisers: Apple’s changes to its iOS software on iPhones asked users for permission before allowing advertisers to track them. Apple’s permission controls – and, ultimately, the decision by users to block tracking – have had a profound impact on internet companies that run on targeted advertising.
Ripple effect: This month, Meta said Apple’s privacy changes would cost it $10 billion this year in lost advertising revenue. The revelation weighed on Meta’s stock price and led to concerns about other companies’ reliance on digital advertising.
Proxy advisory firm raises concerns over Cook’s bonus: Institutional Shareholder Services (ISS) urged Apple Inc investors to vote against chief executive officer Tim Cook’s remuneration, citing concerns around the magnitude and structure of his equity award.
- Apple will hold its annual shareholder meeting in the first week of March.
Quote: “There are significant concerns regarding the design and magnitude of the equity award made to CEO Cook in FY21… Half of the award lacks performance criteria,” ISS said in a letter.
A big fat cheque: Cook took home $3 million in salary in 2021. In addition, he received $82.3 million in stock awards, $12 million for hitting Apple’s targets, $1.4 million for air travel, 401(k) plan, insurance premiums and others. In total, he earned $98.7 million in 2021, compared with $14.8 million a year earlier.
Today’s ETtech Top 5 newsletter was curated by Arun Padmanabhan in New Delhi and Zaheer Merchant in Mumbai. Graphics and illustrations by Rahul Awasthi.
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