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Eternal eyes 100% inventory play for Blinkit to improve margins

EntrackrEntrackr · 3m ago
Eternal eyes 100% inventory play for Blinkit to improve margins
Medial

Eternal eyes 100% inventory play for Blinkit to improve margins Eternal Limited, the company formerly known as Zomato, is gearing up for a strategic shift in its quick commerce arm, Blinkit, by planning to own inventory directly—a move enabled by its recent transition to an Indian-owned and controlled company (IOCC), according to a shareholder letter released by the company. The move will strengthen its operations and improve margins as it faces increased competition from both established players and new entrants in the quick commerce space. Eternal estimates that adopting a 100% inventory model would require less than Rs 1,000 crore in working capital. This amount is only about 5% of Blinkit's expected Net Order Value (NOV) of Rs 22,000 crore for FY25. In response to a question on how a pure-play inventory model could be achieved with Rs 1,000 crore, Eternal’s CFO Akshant Goyal explained that in quick commerce, inventory moves quickly. As a result, the company expects that working capital investments, relative to the overall scale of the business, will remain relatively low. The plan to keep inventory for BlinkIt comes on the back of its aggressive expansion in Q4 FY25, where it added 294 new stores and over 1 million sq ft of warehouse space, pushing its total store count to 1,301. However, such rapid growth led to widening EBITDA losses for Blinkit, from Rs 103 crore in Q3 to Rs 178 crore in Q4 of the last fiscal year (FY25). Even as short-term losses rise, Eternal remains bullish on the long-term profitability of the quick commerce space. The company is not planning private labels for now, but hinted that inventory control could eventually nudge EBITDA margins beyond the 5-6% of NOV it currently targets.

Powerless but profitable: How Google India evades accountability

EntrackrEntrackr · 10m ago
Powerless but profitable: How Google India evades accountability
Medial

In a legal filing, Google India Private Limited clarified its limited role as a mere operational arm of Google LLC, while claiming to have no authority over key services such as YouTube, Ads, Search, G Suite, Google Play Store and others. Google India claimed it only operates as a “non-exclusive reseller” of the Google Ads program in India and functions solely as a support entity, according to a judgment by Bombay High Court in August 2021. A lawyer representing Google India took a similar stance while arguing in the case of Dinkum Data Solutions Private Limited v. Google India, heard on October 14, 2024, at the District Court of Gurugram. The lawyer argued that Google India lacked authority regarding the GSuite email service dispute, contending that Google LLC, as the relevant entity, should be included in the case. Based on this argument, the judge directed the petitioner to add Google LLC as a party to the proceedings. Entrackr attended the court proceedings in person. This revelation sparked concerns among Indian businesses, which face challenges addressing issues locally due to Google India’s lack of control and accountability over the very products and services driving their operations in India. Entrackr also analyzed the petition filed on 24 August 2021 by Google India, (Google India Pvt. Ltd vs. The Bombay Talkies Studios And Ors) where it was emphasized that Google India“does not act as an agent” for Google LLC. Instead, it operates independently, providing only limited support without control over crucial decision-making and management functions tied to Google’s services. In simple words, Indian users and businesses who encounter problems with Google’s services have no alternative but to address these issues with Google LLC, based in the United States. This logic seems flawed and no longer tenable, as Google India reported over Rs 28,000 crore in gross ad revenue with substantial profit in FY23. Thus, even as the firm continues to generate hefty revenues from India, its local operating entity’s toothlessness to provide adequate support or resolve issues for its clients here is beginning to grate. A burden for Indian businesses This limited role Google Indiapresents costly challenges for local companies as Google LLC has no offline presence nor any support team in India. When problems arise, Indian businesses find themselves forced to engage with the teams based in the US or approach legally, a process that can be both time-consuming and financially burdensome. Making one wonder if this was designed to be deliberately so. Thus, unresolved issues often end up in long legal proceedings—a last resort that no business wants to pursue unless absolutely necessary. The situation has also put a heavy financial and operational strain on India’s judicial system. Court cases involving support from Google can take years to conclude, and while a company waits for a resolution, its business continues to suffer, which means that essential matters like data access, service continuity, or even payment processing might be halted, impacting the business’s viability. Vasundhara Shankar, Managing Partner at Verum Legal, explained, “It’s true that Google LLC, the main U.S.-based entity, lacks a direct physical or ‘offline’ presence in many countries, including India, despite generating substantial revenue from these markets. India’s evolving regulatory landscape could introduce more stringent requirements, potentially compelling tech giants to expand their legal and operational footprint within the country.” Google India’s position: local support only Google India has reiterated its limited jurisdiction in its petition, stating that it “maintains a principal-to-principal relationship” with Google LLC and does not operate any core product platforms, such as YouTube or Search, within India, as per the judgment cited above. The petition underscores that any complaints or regulatory actions involving Google’s core services should target Google LLC, which controls all operational and decision-making powers for all services being rendered in India, to its customers. This structure effectively shields Google India from being held accountable for issues stemming from Google’s main services in India. Despite generating substantial revenue through ad sales and other indirect income sources, Google India lacks the authority to directly address concerns from Indian businesses and users. Its position as a support entity means it has no sway in policy changes, customer complaints, or dispute resolutions, leaving Indian businesses to navigate these issues independently or seek costly, time-intensive legal recourse. The larger regulatory debate This situation comes against the backdrop of an ongoing dispute with the Competition Commission of India (CCI) regarding Google’s alleged monopolistic practices, such as requiring device manufacturers to pre-install Google apps on Android devices, a practice criticized as anti-competitive. The CCI’s scrutiny reflects India’s need for regulatory clarity as global tech giants continue to consolidate influence in the Indian market. However, Google India’s limited powers highlight a structural challenge: how can local regulators ensure accountability when decision-making authority resides in another country? This challenge highlights the urgent need for a robust regulatory framework to address foreign tech subsidiaries’ responsibilities within India. Many Indian businesses argue that if Google India can derive revenue from the Indian market, it should be empowered to address local grievances. Otherwise, the accountability gap leaves Indian businesses and consumers to deal with extended service disruptions and limited avenues for redress. Toward a new regulatory paradigm? Google India’s petition cited above may set a significant precedent for tech companies operating in India through foreign parent entities. As more global tech giants establish Indian subsidiaries, it raises a pressing question: should these entities have greater accountability if they are conducting business locally? The answer has implications not just for Google but for the wider landscape of international tech companies that have entrenched themselves in India’s economy. Importantly, in case of social media firms like Google , Meta and others, the argument of India being a small market in the context of global revenues does not hold, as due weightage needs to be given to user base as well, where India is a key market for most, if not all. There is a growing call for the Indian government to mandate that major tech companies empower their Indian subsidiaries with greater authority to handle disputes and service issues. Such a policy would not only bolster consumer protection but also ensure that these corporations remain directly accountable within Indian jurisdiction, aligning with the country’s push for digital sovereignty and data localization. For now, Google India’s legal stance underscores a need for Indian businesses to carefully consider the limitations of subsidiaries in resolving disputes. And until legal and regulatory changes catch up, Indian businesses continue to bear the brunt of an arrangement that shields Google’s parent company from direct accountability, while their operations suffer in the absence of swift and effective resolutions.

Funding and acquisitions in Indian startup this week [09 - 14 Sep]

EntrackrEntrackr · 11m ago
Funding and acquisitions in Indian startup this week [09 - 14 Sep]
Medial

During the week, 24 Indian startups raised around $228.79 million in funding. These deals count 6 growth-stage deals and 13 early-stage deals while 5 startups kept their transaction details undisclosed. During the last week, 26 early and growth-stage startups cumulatively raised $421.29 million in funding. [Growth-stage deals] Among the growth-stage deals, 6 startups raised $182.65 million in funding this week. Mobile advertising network software InMobi spearheaded a $100 million debt funding round. MSMEs-focused fintech lender FlexiLoans raised $35 million followed by, employee healthcare platform Onsurity, spiritual tech startup AppsForBharat, consumer lending platform Moneyview, and HRtech platform HROne with $21 million, $18 million, $4.65 million, and $4 million in funding, respectively. Moneyview also joined the unicorn club following the fresh capital. One growth-stage startup that did not disclose the transaction details is Transcell Biologics. [Early-stage deals] Further, 13 early-stage startups secured funding worth $46.14 million during the week. Wealthtech startup Centricity led the list followed by D2C home decor and lifestyle brand Nestasia, AI reality intelligence platform Track3D, biotech-driven material R&D startup Dharaksha Ecosolutions, and sales outreach platform Futwork among others. As many as 4 startups that did not disclose the funding amount raised are; Trisu, Leezu’s, Fitday, and Agilitas Sports. For more information, visit TheKredible. [City and segment-wise deals] In terms of the city-wise number of funding deals, Bengaluru-based startups led with 8 deals followed by Delhi-NCR, Mumbai, Hyderabad, and Kolkata. Segment-wise, E-commerce startups are on the top spot with 5 deals. Fintech, Healthtech, Cleantech, HRtech, Adtech, and AI startups followed this list among others. [Series-wise deals] During the week, seed funding deals are on top, with 9 deals followed by 4 Series A, 3 pre-seed, 2 pre-Series A, 2 Series B, 1 debt deal, and more. [Week-on-week funding trend] On a weekly basis, startup funding slipped 45.7% to $228.79 million as compared to around $421.29 million raised during the previous week. The average funding in the last eight weeks stands at around $331.70 million with 26 deals per week. [Fund launches] Three new funds launched this week to invest in startups. Playbook Partners has raised over $130 million for its growth capital fund. Proparco has invested $5 million in Omnivore’s third fund focused on agritech and climate sustainability. Arka Investment Advisory Services has launched its second alternative investment fund, focusing on real estate opportunities in India. [Key hirings and departures] Sudharshan Sharma, formerly with Google, joined CarDekho as a CBO for the auto business. Meanwhile, Cleartrip’s CBO Prahlad Krishnamurthi, and the CFOs of InCred (Vivek Bansal) and TAC Infosec (Vishal Jain) resigned from their respective companies. [Mergers and Acquisitions] Nazara Technologies, a prominent gaming company, made two major acquisitions. This includes a controlling stake in Moonshine Technology, the parent company of PokerBaazi, for a substantial sum of Rs 982 crore ($100 million) and a 15.86% stake in Stan, a blockchain-based e-sports fan engagement startup, for $2.2 million. GoKwik, an e-commerce enabler, acquired Return Prime, a global returns management app. Additionally, Moneyview, a digital lender, acquired Jify.co, an early salary/on-demand salary service provider. Yudiz Solutions, a listed blockchain and IT development startup expanded its offerings by acquiring a majority stake in ABCM App, a Mumbai-based digital payment solutions company. The acquisition was valued at Rs 6.14 crore. [Shutdown] InsurStaq.ai, a Delhi NCR-based startup developing generative AI solutions for the insurance industry, has shut down its operations. Despite a year of development and collaboration with insurance professionals, the company faced challenges that ultimately led to this decision. This news comes amidst a period of growth for the generative AI sector in India. Visit TheKredible to see series-wise deals along with amount breakup, complete details of fund launches, and more insights. [New launches and partnerships] IBV and FedTech unveil Indo-US launchpad to boost Indian startups D2C Insider launches Cohort-3 for early-stage D2C brands Zomato launches developer platform for PoS partners [Potential Deals] Slice set to raise over $35 Mn in funding via convertible debt Finova Capital to raise Rs 800 Cr funding Flipkart’s Super.money plans to raise external funds [Financial results this week] Virat Kohli-backed WROGN’s revenue dips 29% in FY24 Purplle hits Rs 700 Cr revenue in FY24, trims losses by 46% NPCI posts Rs 2,876 Cr revenue and Rs 1,134 Cr profits in FY24 [News flash this week] Peak XV, others divest stake worth Rs 1,600 Cr in MamaEarth’s parent Govt. exempts overseas startups from NCLT clearance for reverse flipping Kotak downgrades Nykaa to ‘Sell’, cuts fair value amid concerns Ather files DRHP to raise Rs 3,100 Cr via IPO; Hero MotoCorp won’t sell shares Swiggy to raise Rs 5,000 Cr via fresh issue, to file DRHP soon MobiKwik Xtra suspends ‘anytime withdrawals’; draws flak from users Aditya Birla Finance accuses BYJU’S resolution professional over alleged fraud Delhivery accuses Ecom Express of misinformation in DRHP Pravin Jadhav-led Dhan storms into top 10 stock broking apps Accel announces fourth cohort of the pre-seed investment program, Atoms Pixxel becomes the first Indian space startup to secure a NASA contract DroneAcharya share surges 20% on BSE, hits upper-circuit After Bengaluru, Flipkart Minutes goes live in Gurugram Ather Energy to manufacture electric motorcycle [Conclusion] The weekly funding shrank around 46% to $228.79 million this week. Meanwhile, three startup-focused funds launched this week namely Playbook Partners, Omnivore, and Arka. Peak XV, Stellaris Ventures, Sofina Ventures, and Fireside Ventures collectively sold shares worth Rs 1,600 crore in Honasa Consumer Limited, the parent company of MamaEarth. Kotak Institutional Equities downgraded Nykaa, a leading beauty and fashion e-commerce company, citing concerns about rising fulfillment costs and potential margin pressure. This highlights the challenges faced by e-commerce companies in maintaining profitability amidst increasing competition and operational complexities. Ather Energy, an electric two-wheeler firm, filed its DRHP for an IPO, marking the second such listing in the EV sector. Swiggy, a food delivery and quick commerce company, also planning to file the DRHP soon and is set to raise Rs 5,000 crore via a fresh issue. MobiKwik’s Xtra investors faced withdrawal issues due to changes in the withdrawal policy by its lending partner Lendbox. This was triggered by recent RBI regulations on P2P lending. MobiKwik clarified that withdrawals will be made on a monthly basis and assured customers of receiving their principal and interest.

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