Also in the letter:
■ Govt’s ONDC push on ecommerce sites
■ HCLTech shares fall 6% post Q4 results
■ ETtech Done Deals
Ola Cabs CEO Hemant Bakshi resigns; firm to lay off 200 employees
Ola Cabs’ chief executive Hemant Bakshi is quitting after just three months in the job, even as the ride-hailing major is looking to lay off about 200 employees.
Driving the news: The job cuts will impact about 10% of the firm’s total workforce. Bakshi, who had joined from fast-moving consumer goods (FMCG) major Unilever, had joined Ola Cabs to take over the day-to-day business as founder Bhavish Aggarwal had stepped back.
Changing times: Bakshi’s exit and the restructuring come as the firm prepares to file draft initial public offering (IPO) papers in the next few months. Ola Cabs is also set to exit its existing international markets – UK, Australia and New Zealand – by the end of this month.
Eye on profitability: In January, Bakshi had said ANI Technologies – the parent of the cab-hailing business – had turned profitable on an earnings before interest, taxes, depreciation and amortisation (Ebitda) basis in FY23. The standalone ride-hailing business posted Ebitda of Rs 250 crore compared to an Ebitda-level loss of Rs 66 crore a year ago, he added.
Ecosystem of companies: ANI’s sister firm Ola Electric, also founded by Bhavish Aggarwal, filed its draft IPO papers with Sebi in December and is waiting for the regulator’s nod. The electric scooter maker is looking to raise up to Rs 5,500 crore through a fresh issue, apart from an offer-for-sale (OFS) component of 95.2 million shares. Meanwhile, artificial intelligence firm Krutrim AI, Aggarwal’s third firm, raised $50 million at a valuation of $1 billion in January.
Musk in China: Tesla clears data security, full self-driving hurdles
Tesla CEO Elon Musk’s surprise visit to China, the EV maker’s second largest market, has yielded significant results. The automaker cleared some major regulatory hurdles that have kept it from rolling out its self-driving software in the country.
Driving the news: Tesla’s China-made cars passed key data security and privacy tests, a major win for Musk who was in Beijing seeking approval for its driver-assistance software. Previously, Tesla vehicles had faced bans from Chinese military installations and certain governmental sites due to apprehensions over data collection.
Testing: China has designed data security assessments to check methods by which vehicles gather “sensitive personal information” and the ease with which drivers can halt data collection. Tesla’s Model 3 and Model Y vehicles were subjected to testing and deemed compliant with the country’s data security standards.
Also read | What is Tesla’s Full Self Driving and why its China rollout matters
Bumps in the road: Tesla launched its Full Self-Driving (FSD) software in 2020, but has been unable to offer it in China due to data security and compliance issues.
Since 2021, Chinese officials have demanded that Tesla keep all data collected via cars to be stored in Shanghai, and not send it back to the US. Musk wants permission to send some of the data collected in China to other countries to improve the software.
Wooing China: Tesla aims to win over China, a key market fraught with established rivals like Nio, Li Auto, XPeng and BYD. A week ago, it slashed prices for all its vehicles in the country and started incentives like insurance subsidies for customers.
Musk’s trip to China came shortly after he cancelled a scheduled trip to India to meet Prime Minister Narendra Modi, citing “substantial Tesla commitments.”
Also read | Tesla delivers record Q4 cars, but China’s BYD steals top EV spot
Government push to help ONDC get shopfront on ecommerce sites
The government has asked ecommerce majors Amazon and Flipkart to set up Open Network for Digital Commerce (ONDC) storefronts on their home pages to boost the government-backed network’s operations and iron out glitches, executives told ET.
Driving the news: This is a significant development, as the ONDC was initially pitched as an entity to counter the dominance of Amazon and Flipkart.
ONDC managing director T Koshy confirmed to ET that the network is “in active discussion” with the ecommerce players for phased participation and that results could be expected soon.
A look back: In February last year, Amazon had announced plans to integrate its logistics network — from pickup to delivery — and SmartCommerce services with ONDC. Sources had said there were no immediate plans to integrate Amazon India’s core marketplace with ONDC. If that is done, the US ecommerce giant’s users will be able to see product catalogues of more than 105,000 non-mobility sellers currently live on the government-backed network.
Also read | PhonePe’s Pincode exits non-food categories in ecommerce business rejig
Win for small sellers: The ONDC network makes it easier for smaller players to get visibility without paying a hefty commission or individually signing on to Amazon.
Also read | Is ONDC’s gamble paying off?
HCLTech shares fall 6% after Q4 results
C Vijayakumar, CEO and MD, HCLTech
Shares of HCL Technologies dipped 6% in early trade to a day’s low of Rs 1,382 on the NSE Monday after the IT major reported a net profit of Rs 3,995 crore for the quarter ended March 31, 2024 – falling short of analysts’ estimates of Rs 4,080 crore. The stock closed the day at Rs 1,388.30.
Result highlights: Led by a 12.1% YoY growth in the financial services vertical, HCLTech delivered the highest on-year growth in the Indian IT industry at 8.3% in FY24. Consolidated revenue from operations stood at Rs 28,499 crore, up 5.3% on year. The board recommended an interim dividend of Rs 18 per share for FY25.
CEO insights: Financial services, which drove the growth for HCLTech, is set to see some revenue impact in the first quarter of FY25, the company’s CEO and MD, C Vijayakumar, told ET in an interaction
Industry turmoil: In the past two weeks of the final quarter and full fiscal 2024 earnings announcements, most IT majors missed their revenue growth guidance. Many downward revisions for the year ahead were seen despite most firms bagging large deals and holding substantial total contract value (TCV) wins.
ETtech Done Deals
PayU invests $5 million in BriskPe: Digital payments major PayU has invested $5 million in Mumbai-based cross-border payments platform BriskPe, in its first institutional funding round.
This investment aligns with PayU’s strategy to create a full-stack payments platform for domestic and international transactions. It will strengthen the company’s existing export and import services in India.
Customer loyalty startup Reelo raises $1 million: Customer loyalty and marketing startup Reelo has raised $1 million from Silicon Valley-based investor Gokul Rajaram, who has backed companies like online marketplace Faire, Figma, and collaboration software startup Airtable.
Reelo will use the funds to ramp up hiring across all departments, expand its footprint in new global markets, and enhance its AI and machine learning capabilities.
Founded in 2021 by siblings Prit and Parin Sanghvi, Reelo offers a suite of marketing tools to small and mid-sized businesses.
Today’s ETtech Top 5 newsletter was curated by Vaibhavi Khanwalkar in Bengaluru and Ajay Rag in Mumbai.
