SBI Mutual Fund is investing INR 410 Cr in Mumbai-based gaming and sports media giant Nazara. In a stock exchange filing, Nazara said that its board has approved the issue of shares worth INR 410 Cr to SBI Mutual Fund, which would include 57,42,296 equity shares with a face value of INR 4 each, at a price of INR 714 per share.

The funds will be invested via three schemes of SBI Mutual Fund, namely SBI MulScap Fund, SBI Magnum Global Fund and SBI Technology Opportunities Fund.

“Making India the gaming nation of the world has been a long-pursued dream for all of us at Nazara. India’s largest domestic mutual fund investing in Nazara is an important milestone for us in this two decade long journey,” Nitish Mittersain, CEO of Nazara Technologies, said.

This comes close on the heels of the announcement of Zerodha founders Nithin Kamath and Nikhil Kamath investing INR 100 Cr in Nazara Technologies.

The company announced its plan to issue 14,00,560 equity shares with a face value of INR 4 each, priced at INR 714 per share to M/s Kamath Associates and M/s NKSquared managed by Kamath brothers.

The gaming giant had secured board approval to raise up to INR 750 Cr and increase its authorised share capital from INR 30 Cr to INR 50 Cr.

In the financial year 2022-23 (FY23), the company reported a consolidated net profit of INR 61.4 Cr, marking a significant increase, while its revenue from operations grew by 75% year-on-year (YoY) to INR 1,091 Crores during the same period.”

The gaming firm’s profit after tax (PAT) rose 31% YoY to INR 20.9 Cr in the first quarter (Q1) of the financial year 2023-24 (FY24). Nazara’s revenue from operations jumped 14% to INR 254.4 Cr during the quarter under review from INR 223.1 Cr in the year-ago quarter.

Nazara shares were trading at INR 875 at 12:00 pm on BSE.

The post SBI Mutual Fund To Invest INR 410 Cr In Gaming Giant Nazara appeared first on Inc42 Media.

Google plans to continue permitting real-money games on its Play Store, pending approval from self-regulatory bodies, once the government introduces a new regulatory framework for gaming platforms.

These apps will remain available for download via Google Play due to them being part of a pilot project by the tech giant. Google started a year-long pilot to offer daily fantasy sports and rummy apps to users in India in September 2022. The pilot is set to end later this month.

The tech giant’s stance would likely be a shot in the arm for skill-based gaming companies that are currently under immense pressure following the government’s recent move to implement a 28% GST on real money games.

“We intend to enable distribution on Google Play for all Self Regulatory Bodies (SRB) verified online real money games that comply with our policies. We are closely tracking all developments in this regard to determine next steps and timelines,” a Google spokesperson said.

For now, the tech giant has updated its support page to mention that it will no longer accept new apps into the pilot programme after the pilot ends. Google will still provide a grace period for existing apps that are already a part of the pilot programme to remain on Google Play till January 15, 2024.

In April, MeitY notified new gaming-related amendments to the IT Act 2021, allowing multiple self-regulatory organisations (SROs) to determine whether a real money game is permitted to operate in India.

Real money games are still awaiting more clarity from the GST Council on the exact GST norms and which companies will come under the ambit of the move. However, this is still being perceived as a black swan event for online gaming in India.

Since the introduction, several gaming startups have trimmed their workforce, while few even decided to halt operations temporarily. Gaming unicorn Mobile Premier League (MPL) slashed 350 jobs, Hike slashed its workforce by 25% and online gaming platform Spartan Poker fired 125 employees in recent weeks. 

At the same time, the likes of Fantok suspended operations temporarily, while many small real-money gaming companies are looking to get acquired amid the increased tax burden.

The post Google To Allow Real Money Games On Play Store appeared first on Inc42 Media.

Meta India head Sandhya Devanathan said that India’s recently enacted Digital Personal Data Protection (DPDP) law has established a clear framework for tech companies, striking a balance between safeguarding user interests and fostering innovation.

She emphasised that the company “welcomes constructive regulations” and will wait to see the specifics of the rule.

“What DPDP has done is, it has provided a framework for tech companies to operate in and has provided clarity. We are waiting for the rules to get written out. But I would say that this is a great step in balancing user protection with innovations … because that is what will power India techade,” she said.

The Digital Personal Data Protection (DPDP) bill, introduced last year, became law after receiving approval from both houses of the Indian Parliament — Lok Sabha and Rajya Sabha. President Droupadi Murmu subsequently gave her assent, officially enacting the legislation.

Meta views India as a key market with immense potential driven by its robust macroeconomic growth, well-developed digital infrastructure, and the widespread popularity of its apps, including Facebook, WhatsApp, and Instagram, Devanathan told news agency PTI.

India is one of Meta’s largest user bases worldwide, with 400 Mn Facebook users, and 326.6 Mn Instagram users.

Addressing concerns that Facebook is losing its appeal among teenagers and young adults in important markets, Devanathan insisted that the platform continues to be relevant and attract a diverse user base across all age groups.

Additionally, she noted a rising trend of small businesses utilising Meta’s platforms and tools to establish their online presence and connect with customers.

She also highlighted that Meta India plays a pivotal role in global innovation efforts for the company, serving as both a testing ground and a development hub for new products. She assured that this investment in India will continue.

Devanathan took over the reins as Head and Vice President of Meta India last year, succeeding Ajit Mohan who had resigned from the company in November 2022.

Devanathan spearheads the company’s India operations and looks at strengthening the strategic relationships with the country’s leading brands, creators, advertisers, and partners to drive Meta’s revenue growth in key channels in India.

In India, Meta, like many other tech and social media giants, has found itself entangled in legal disputes with the government. Presently, it is under investigation by the Competition Commission of India (CCI) regarding WhatsApp’s controversial privacy policy update in 2021.

Recently, Meta announced updates to its policy governing posting content related to sexual exploitation across its platforms following a recommendation from the Oversight Board (OB) based on a 2022 video depicting the sexual assault of a tribal woman in India.

The post Meta India Head Lauds DPDP Law For Providing Tech Cos Clear Guidelines appeared first on Inc42 Media.

A month after foodtech giant Zomato started levying a platform fee of INR 2, and later increased it to INR 3 for some users, Kotak Institutional Equities has said the fee will increase the company’s customer take rate and contribution margin.

“On the app, Zomato says, ‘This small fee helps us pay the bills so that we can keep Zomato running.’ We note that over the past few quarters, bulk of the take-rate improvement has been driven by a restaurant take-rate increase and delivery take-rate has lagged,” the analysts at the brokerage said.

“The company’s intent seems to be to monetise select customers better, resulting in an increase in customer take-rate, which flatlined over the past few quarters,” said the analysts.

In simple terms, the take rate is the commission that Zomato charges from restaurants and customers for facilitating an order.

Early last month, Zomato began charging a platform fee of INR 2 per order for select users on its platform, mirroring the move of its rival Swiggy. Within a few week, Zomato increased the platform  fee to INR 3 for some customers in certain cities.

In response to Inc42’s queries on the matter, a Zomato spokesperson said that the platform fee would be applicable to all customers but the changes are still in the experiment stage and are being rolled out gradually across the country.

Giving a calculation of how the platform fee could increase Zomato’s margin, Kotak said the company reported 2.7 Mn high-frequency customers in 2022 with annual ordering frequency of more than 50. Assuming these customers transact 75 times a year on average, an INR 2 per order platform fee on all these orders would result in INR 40.5 Cr of incremental contribution to profit/EBITDA. 

The analysts said this would also imply about a 16 basis points (bps) increase in contribution margin, helping Zomato move towards its targeted 8% margin (as % of GMV) over the medium term.  

The contribution margin of Zomato’s food delivery business stood at 6.4% in Q1 FY24. 

Reiterating its ‘buy’ rating on Zomato, Kotak raised the fair value of the stock to INR 110 from INR 105 earlier, implying an upside of 12% to its last close.

Besides, Kotak also said that if Zomato increases the scale of business and control of overheads in its ecommerce business, Blinkit, and B2B business, Hyperpure, these segments can also achieve profitability over the next few quarters.

Zomato reported a net profit of INR 2 Cr in Q1 FY24 with an operating revenue of INR 2,416 Cr.

Shares of Zomato ended Tuesday’s session marginally higher at INR 98.2 on the BSE.

The post Here’s Why Kotak Sees Zomato Making A Bull Run appeared first on Inc42 Media.

Mumbai-based interior design startup Flipspaces has raised $4 Mn in its Pre-Series B funding round led by Prashasta Seth, former CEO of IIFL AMC. The funding round, which was a mix of equity and debt, also saw participation from other prominent family groups and funds. 

Flipspaces, which is backed by Carpediem Capital, said it will utilise the fresh capital to expand its operations on the West Coast of the US and strengthen its tech.

Commenting on the development, Kunal Sharma, founder and CEO of Flipspaces, said, “We’ve seen rapid growth in the US market combined with robust India numbers. Leveraging this momentum, our impetus is to enhance our focus on tech to enable processes at scale and double down on building on our supply chain capability to serve a global demand.”

The funding round comes almost two years after the startup raised $2 Mn from Seth and other HNIs. “We have been a profitable business because of strong unit economics and thus, have a long runway with this funding,” Sharma then told Inc42.

Prior to this, the startup raised a debt round of $1.15 Mn from UC Inclusive Credit and Alex Group. It also raised $3.5 Mn in its Series A funding round from Carpediem Capital.

Founded in July 2015 by IIT Bombay alum Sharma, Vikash Anand, and Ankur Munchal, Flipspaces designs interiors and builds projects for commercial spaces. The startup is currently operational in the US and India.

The startup has two offerings – Vizworld and Vizstore. Vizworld is a tech-enabled brand which offers a full stack solution for designing and building commercial spaces, while Vizstore offers a variety of furniture and furnishing products across categories. 

The startup counts Reebok, Oppo, Zeta, Indiqube, among others, as its clients. 

Flipspaces competes against the likes of Livspace, HomeLane, and Bonito Designs. Earlier this year, Design Cafe raised INR 40 Cr in a round led by WestBridge Capital, Mirabilis Investment Trust and Alteria Capital.

According to a Technavio report, India’s online home decor segment is estimated to expand at a CAGR of 10.2% during 2021-26 to reach a size of $3.75 Bn by 2026.

The post Interior Design Startup Flipspaces Raises $4 Mn Funding appeared first on Inc42 Media.

In the ever-evolving landscape of online delivery services, one can trace the journey of early movers and the shifting preferences of consumers over the years. Ankit Nagori, the founder of Curefoods, predicts a fundamental shift in the industry’s future, one that will shape the next million customers.

This shift revolves around the emergence of a new category of consumers – those seeking daily convenience. These individuals will turn to online food delivery and not just for special occasions, according to Nagori.

“I am slowly seeing a change in the industry which indicates that the next million customers will come from that segment where people are seeking convenience, people who are ordering it daily because they don’t want to cook,” Nagori said while speaking at The D2C Summit 2023 organised by Inc42.

While this transformation holds the opportunity of a significant increase in the frequency of food orders on online platforms, the industry must focus on improving the quality of food, packaging, delivery, and overall user experience to cater to this evolving customer base, he added.

Moreover, foodtech giants such as Zomato and Swiggy are also talking about making food ordering a daily habit, Nagori said, adding that brands such as Curefood’s Eatfit are expected to play an important role in this transition.

The online food delivery revolution began with deal seekers – individuals who embraced the discounted meals delivered to their doorstep. Then, in the last five years, the online food delivery industry witnessed a significant shift towards entertainment. Consumers increasingly turned to these platforms for a variety of reasons, from enjoying a movie night to seeing gatherings at home, Nagori said. This change was more catalysed by the pandemic.

Founded in 2020 by Ankit Nagori, Curefoods claims to run more than seven food factories and 150+ multi-brand cloud kitchens to service 200+ locations in 15 cities. Besides Eatfit, the startup houses brands such as CakeZone, Nomad Pizza, Frozen Bottle, and Sharief Bhai, among others.

Earlier this year, Curefoods raised INR 300 Cr (around $37 Mn) in a funding round led by Binny Bansal’s fund Three State Ventures, which invested INR 240 Cr.

The post Why Curefoods’ Founder Believes Convenience Models Will Boost The Indian Foodtech Space appeared first on Inc42 Media.

Zomato will be liquidating its Czech Republic-based subsidiary, Lunchtime, the listed foodtech giant said in an exchange filing.

“Pursuant to Regulation 30 of the Listing Regulations, we wish to submit that Lunchtime.cz s.r.o. (“Lunchtime”), step down subsidiary of Zomato Limited (“the Company”) situated in Czech Republic has initiated the process of liquidation on September 01, 2023,” said Zomato.

According to the foodtech giant, Lunchtime had no active business operations. The subsidiary is valued at INR 28.2 Lakhs and has zero turnover or contribution to Zomato’s net worth.

Zomato has been shuttering non-performing subsidiaries across the world to focus more on the Indian market.

This year, Zomato has already closed subsidiaries in Indonesia, Portugal, and Jordan, as well as announcing a planned exit from the Philippines. Most of these subsidiaries were non-operational.

Currently, Zomato only has active operations in India and the UAE. In November 2022, Kuwait-based foodtech startup Talabat shut down Zomato’s food delivery unit in the UAE, which it acquired for a reported $172 Mn in 2019.

The Indian foodtech continues to offer restaurant discovery and dining-out services in the UAE.

At the start of the year, Zomato said it pulled out of 225 cities in the country owing to poor performance. In a shareholder letter, Zomato CFO Akshant Goyal said the foodtech exited around 225 smaller cities in January, which contributed 0.3% of our GOV (gross order value) in Q3FY23 (October-December).

The foodtech major also introduced a platform fee ranging from INR 1 to INR 3 per order to better monetise and sustain operations in smaller cities. Zomato’s monetisation and cost-cutting efforts saw it post a profit of INR 2 Cr for the June quarter of FY24, a feat it achieved for the first time. 

Last week, Tiger Global and SoftBank sold shares they held in the foodtech giant, with the former completely exiting the startup, prompting a jump in Zomato’s share price.

Zomato shares have been buoyant on the bourses over the past few months, hitting a 52-week high of INR 102.85 apiece last month. At 1:15 PM on Monday (September 4), the foodtech’s shares were trading at INR 98.05 on the BSE, slightly higher than Friday’s close.

The post Foodtech Giant Zomato Shutters Czech Subsidiary Lunchtime appeared first on Inc42 Media.

Gaming and sports media platform Nazara Technologies’ board has approved the issue of shares worth INR 100 Cr to firms managed by Zerodha founders Nithin Kamath and Nikhil Kamath, the company said in an exchange filing on Monday.

The company plans to issue 14,00,560 equity shares with a face value of INR 4 each, priced at INR 714 per share. The issuance will amount to INR 100 Cr, and shares will be proportionately allotted to M/s Kamath Associates and M/s NKSquared, a partnership firm represented by its partners Nikhil and Nithin Kamath.

“Nazara Technologies Limited, an India-based, diversified gaming and sports media platform today announced that its board has approved preferential allotment of equity shares to raise up to INR 100 Cr, subject to the receipt of approval of the shareholders of the company and such regulatory/statutory authorities as may be applicable,” the company said.

Nazara intends to use the capital to fulfill the funding needs and support the company’s growth initiatives, which may include strategic acquisitions and investments.

“Nikhil Kamath symbolises success in India’s tech arena, and this fundraise holds immense value for us at Nazara as we continue to build a diversified gaming platform in India. Beyond the funds raised, his investment stands as a resounding vote of confidence in Nazara,” Nitish Mittersain, CEO of Nazara Technologies, said.

Nikhil Kamath, partner of Kamath Associates and NKSquared, said, “Gaming in India is poised for strong growth in the years to come and Nazara has built a well-diversified, profitable gaming platform well suited to take advantage of opportunities in the years ahead.”

Last week, reports surfaced that Nikhil Kamath, the founder of Zerodha, was considering increasing his stake in Nazara Technologies to 3.5%. Kamath was in discussions to increase his personal investment in the company.

On August 30, the company announced that it would seek board approval to raise capital via the issuance of equity shares or securities on a preferential basis. In July, the gaming giant also secured the board’s approval to raise up to INR 750 Cr and increase authorised share capital to INR 50 Cr from INR 30 Cr.

Earlier in August, Nazara pumped $500K into an Israeli game developer, Snax Games, to acquire the exclusive rights to publish the latter’s games in the Indian subcontinent and the Middle East on a revenue-sharing basis for the next five years. In May, the company said that it would increase its stake in Next Wave Multimedia to nearly 72%

The company’s consolidated net profit jumped to INR 61.4 Cr in the financial year 2022-23 (FY23), while revenue from operations soared 75% year-on-year (YoY) to INR 1,091 Cr during the period under review.

The post Zerodha Founders To Invest INR 100 Cr In Nazara appeared first on Inc42 Media.

Speaking at the fourth edition of Inc42’s The D2C Summit, Ankit Nagori, the founder of Curefoods, said that it is on the back of membership and subscription programmes that their flagship brand Eatfit has a 70% customer retention rate.

“70% of people who subscribe to Eatfit never leave the platform. Either they will continue as subscribers or they move back into the membership programme,” Nagori said.

Nagori explained that while their brand has focussed on subscription services, they have also introduced a membership programme called Food Pass. This decision was based on the understanding that customers may not consume their products 30 times a month.

Subscribers typically consume their products a certain number of times each month, with the platform’s average being seven times a month. To retain customers who fall within the range of seven to 30 times a month to stay engaged, they have introduced the Food Pass programme.

Nagori advocated for adopting membership programmes for D2C brands with high-frequency products. These programmes offer customers a broader engagement experience with added perks such as free shipping and exclusive benefits. For brands like Curefit, where high-frequency consumption exists, membership programmes became the foundation of customer engagement, he added.

On the other hand, subscription programmes, he said, cater to specific use cases or habits. These programmes, though targeting a smaller customer base, tend to foster deep customer engagement and loyalty.

Founded in 2020 by Ankit Nagori, Curefoods claims to run more than seven food factories and 150+ multi-brand cloud kitchens to service 200+ locations in 15 cities. Besides Eatfit, the startup houses brands such as CakeZone, Nomad Pizza, Frozen Bottle, and Sharief Bhai, among others.

Earlier this year, Curefoods raised INR 300 Cr (around $37 Mn) in a funding round led by Binny Bansal’s fund Three State Ventures, which invested INR 240 Cr during the fundraise.

In July, Curefoods made a strategic investment in Hyderabad-based millet startup, Millet Express.

Curefoods recorded INR 89.1 Cr in revenue from operations during the fiscal year ending March 2022, which was the first full operational year for Curefoods.

The post Our Flagship Brand Eatfit Enjoys A Customer Loyalty Rate Of 70%: Curefoods’ Ankit Nagori appeared first on Inc42 Media.

South Korean gaming giant KRAFTON has reportedly received full approval from the Centre to operate its battle royale game Battlegrounds Mobile India (BGMI) in India. 

The nod was granted after the company passed a three-month long audit process, Moneycontrol reported citing sources. The game will now have to undergo quarterly assessments to keep the approval, the report added.

Inc42 has reached out to KRAFTON for a comment on the development. The story will be updated on receiving a response from the company.

The development is expected to provide a major relief to the company as BGMI, one of the top grossing games in the country, has been mired in multiple regulatory issues in the country.

The government’s move comes ahead of the expiration of the three-month trial period granted by the Ministry of Electronics and Information Technology (MeitY) to KRAFTON in May this year for the India-only game. The pilot run came nearly 10 months after the ministry issued an order which led to the delisting of the game from Google Play and Apple App Store.

In May, Minister for State for IT Rajeev Chandrasekhar said that the interim approval was accorded after the game complied with government directions on issues related to server locations, data security, among others.

The nod comes close on the heels of Singaporean gaming major Garena’s re-entry into the country after its game Free Fire faced suspension in the country for more than one-and-a-half years. Taking a leaf out of KRAFTON’s playbook, Garena has introduced an India-specific version of the popular game Free Fire, which will go live on September 5. Besides, it has also partnered with Hiranandani Group-owned cloud service provider Yotta to comply with data localisation norms. 

Both PUBG, now BGMI, and Free Fire were among the top grossing Android games in the country prior to their suspension. While BGMI has seen considerable success after its relaunch in India, Garena is also expected to cash-in on the growing petite of Indians for online gaming. 

As internet and smartphone penetration soars, India has emerged as one of the hottest gaming markets globally. As a result, a host of global companies from Taiwanese gaming giant Softstar to Chinese player Tencent have made a beeline for India and launched products for Indians. 

As per a report, Indians spent 8.5 hours per week, on an average, on mobile games in FY22. It is pertinent to note that major titles such as BGMI enjoy a much higher user base, with gamers spending more time while playing popular games. 

Going forward, India’s gaming space is expected to surge to a market size of $8.6 Bn by FY27 on the back of growing adoption of online gaming. 

The post After 3-Month Audit, KRAFTON Gets Full Approval To Operate BGMI In India appeared first on Inc42 Media.

Zomato has become the latest startup to hop on the artificial intelligence (AI) bus with the launch of Zomato AI to offer convenience and personalistation to customers.

Zomato AI is essentially a chatbot or an assistant which would help customers suggest food dishes and restaurants. Zomato will roll out the feature gradually, exclusively for Zomato Gold users.

“Transcending the boundaries of conventional chatbots, Zomato AI is an intelligent, intuitive foodie companion, designed to cater to users’ ever-changing preferences, dietary needs, and even their current moods,” the company said in a statement.

Zomato AI’s multiple agent framework brings a variety of prompts for different tasks. For example, Zomato AI will present customers with a widget, listing all the restaurants serving a desired dish.

In addition, Zomato AI can also suggest a list of popular dishes or restaurants if a customer is unsure about what to order, the statement said.

Zomato AI will allow customers to send multiple messages and will respond back in almost real-time.

“Proficient in handling complex queries, Zomato AI is designed to be users’ ultimate foodie friend… Zomato AI is a groundbreaking innovation that will allow customers to discover the right food at the right time and has the potential to redefine food ordering experiences,” the company added.

With the rise in popularity of AI after the launch of Open AI’s ChatGPT, a number of Indian startups have adopted AI to enhance their offerings. Zomato’s rival Swiggy and online travel aggregator ixigo are among these startups.

Zomato also launched a generative AI-based product for its quick commerce platform Blinkit.

Meanwhile, Zomato has been on a spree of new launches to expand the features available to its users. In June, it launched a multi-restaurant cart feature which allows users to make multiple carts at the same time. Earlier, users could add items from only one restaurant at a time.

It also introduced ‘Zomato Food Trends’ to help restaurant partners make data-driven decisions.

Amid all this, the startup also reported its first profitable quarter in April-June. Zomato posted a consolidated profit after tax (PAT) of INR 2 Cr in Q1 FY24 as against a net loss of INR 186 Cr in the corresponding quarter of the previous fiscal year.

The gross order value (GOV) of Zomato’s food delivery business stood at INR 7,318 Cr in Q1 FY24 as against INR 6,425 Cr in the corresponding quarter of the last fiscal.

The post Zomato Introduces AI-Powered Assistant To Help Customers Place Orders appeared first on Inc42 Media.

Nikhil Kamath, the founder of Zerodha, is reportedly considering increasing his stake in Nazara Technologies, a mobile gaming company and sports media platform, to 3.5%.

Currently holding approximately 1% of Nazara, Kamath is in discussions to increase his personal investment in the company, CNBC TV18 reported.

Nazara Technologies, which is scheduled to hold a board meeting on September 4, has discussed its plans to secure additional funds. On August 30, the company announced that it would seek board approval to raise capital via the issuance of equity shares or securities on a preferential basis.

“Pursuant to Regulation 29 of the Listing Regulations, we wish to inform you that a meeting of the Board of Directors of Nazara Technologies Limited (the “Company”) is scheduled to be held on Monday, September 04, 2023, inter-alia, to consider and if thought fit, approve raising of funds by issuance of equity shares/ securities of the Company on a preferential basis,” the company said in an exchange filing.

In July, the gaming giant also secured the board’s approval to raise up to INR 750 Cr and increase authorised share capital to INR 50 Cr from INR 30 Cr. However, since then, there have been no reports confirming the shareholder approval of the same.

Earlier in August, Nazara pumped $500K into an Israeli game developer, Snax Games, to acquire the exclusive rights to publish the latter’s games in the Indian subcontinent and the Middle East on a revenue-sharing basis for the next five years. In May, the company said that it would increase its stake in Next Wave Multimedia to nearly 72%

The company’s consolidated net profit jumped to INR 61.4 Cr in the financial year 2022-23 (FY23) while revenue from operations soared 75% year-on-year (YoY) to INR 1,091 Cr during the period under review.

The post Zerodha’s Nikhil Kamath Explores Increasing Stake In Nazara appeared first on Inc42 Media.

Shares of gaming unicorn Nazara Technologies jumped more than 8.2% on the BSE to reach a 52-week high of INR 814.30 during Thursday’s early trade (August 31). 

As the day progressed, the stock pared some of the gains and remained flat before gathering pace again at around 2 PM. Nazara stock closed the day up 3.46% at INR 777.75 on the BSE.

The company’s market capitalisation stood at INR 5,146.69 Cr, while around 57,308 shares of Nazara exchanged hands on Thursday. 

A day ago, on August 30, the company announced that it would seek board approval to raise capital via the issuance of equity shares or securities on a preferential basis, likely paving the way for the spurt in the stock. 

For the next two days, the trading window for dealing in securities of the company shall be closed for the ‘designated persons and their immediate relatives and the connected persons’ till the Nazara board votes on the proposal to approve raising funds.

It is pertinent to note that the gaming giant secured the board’s approval, in July, to raise up to INR 750 Cr and increase authorised share capital to INR 50 Cr from INR 30 Cr. However, since then, there have been no reports confirming the shareholder approval of the same. 

Meanwhile, there is also no clarity on the reason why the startup wants to raise fresh capital. However, the funds could likely be deployed to fuel the company’s acquisition and expansion plans. 

Earlier in August, Nazara pumped $500K into an Israeli game developer, Snax Games, to acquire the exclusive rights to publish the latter’s games in the Indian subcontinent and the Middle East on a revenue-sharing basis for the next five years. 

In May, the company said that it would increase its stake in Next Wave Multimedia to nearly 72%. In March, it acquired a 73.27% stake in Pro Football Network through its subsidiary SportsKeeda.

The development comes at a time when Nazara has been logging healthy and profitable numbers. The company’s consolidated net profit jumped to INR 61.4 Cr in the financial year 2022-23 (FY23) while revenue from operations soared 75% year-on-year (YoY) to INR 1,091 Cr during the period under review. 

Consequently, the stock has seen hefty trading on the bourses. In the past week, Nazara’s shares have zoomed 6.25% while growing nearly 30% so far this year.

The post Amid Plans To Raise Fresh Capital, Nazara Stock Touches 52-Week High appeared first on Inc42 Media.

Shares of the foodtech giant Zomato continued their 5% rally from the previous day as the price increased 1% in the morning trade on Thursday (August 31), after SVF Growth sold 10 Cr equity shares in the company.

Zomato shares were trading at INR 100.7 at 9:26 AM on the National Stock Exchange. However, following the initial cheer, the company’s share price fell to INR 99.45 at 12:27 PM, slightly lower than Wednesday’s close.

To recap, SVF Growth sold a 1.16% equity stake in Zomato at INR 94.7 per share in a bulk deal on August 30, earning the SoftBank affiliate INR 947 Cr. SVF Growth’s shareholding in the company was 3.35% or 28.71 Cr shares as of June 2023.

SoftBank received a stake in Zomato following the foodtech giant’s acquisition of the quick commerce startup Blinkit last August. After the one-year lock-in period expired, the Japanese investment major moved to exit the startup. Recent reports suggest that the Japanese tech giant is looking for a complete exit from the foodtech giant. 

Goldman Sachs Investments, Copthall Mauritius Investment Fund, BNP Paribas Arbitrage, Franklin Templeton Mutual Fund, Axis Mutual Fund, Kotak Mahindra Fund, Morgan Stanley Asia Singapore and others were the buyers of the deal.

The listed food delivery giant has been on an upward trajectory this year. Since the start of 2023, Zomato’s share price has rallied by 65% on the bourses, outperforming both the BSE and the NSE by many multiples. The startup’s shares recently hit a new 52-week high of INR 102.85, with its shares frequently crossing the INR 100 mark.

The foodtech also posted a profit of INR 2 Cr in the April-June quarter, compared to a loss of INR 250 Cr in the same period last year. Revenue increased 70% year-on-year (YoY) to INR 2,416 Cr in the same period.

In other news, Tiger Global Management, another foreign investor in Zomato, sold its entire shareholding of 1.44% in Zomato for INR 1,123.85 Cr on August 28. The shares were offloaded by Internet Fund III Pte Ltd in an open market transaction.

The foodtech has recently started charging a platform fee to customers, which has been a key driver in its profitability. Zomato is charging between INR 2 and 3 per order, depending on the city, with the platform fee being rolled out to customers in Tier II and III towns first.

The post Zomato Shares Rally Post SVF Block Deal appeared first on Inc42 Media.

Japanese investor SoftBank is planning to completely divest its holdings in foodtech giant Zomato through open market transactions in the upcoming months. This comes after SoftBank gained a profit exceeding INR 100 Cr by divesting a portion of its stake in the company earlier this week.

SoftBank also holds another 2.18% stake in Zomato, and it is actively looking at divesting this stake through block deals in the upcoming months, Moneycontrol reported.

The Japanese investor offloaded 10 Cr Zomato shares at an average floor price of INR 94.70 per share, in contrast to their average acquisition cost of INR 83-85 per share. This resulted in a per-share profit ranging between INR 10-12.

The development follows the expiration of the lock-in period for Blinkit investors, who received Zomato shares following the acquisition of the quick commerce player by the foodtech giant. SoftBank, which was an investor in Blinkit, received a stake of 3.35% in Zomato post the acquisition last year.

Given that Zomato was not SoftBank’s initial investment, the investor is not willing to retain the stake in the company.

“For SoftBank, Zomato is just a monetary transaction, unlike Delhivery, Paytm or PB Fintech, which it entered as a direct strategic investor. So, it is looking at the deal only from a monetary perspective. It was waiting for Zomato to turn into a profitable bet and now that it has, it will look to exit the company fully as and when it gets opportunities,” the report added, quoting a source.

Zomato acquired the quick-commerce player in August last year in an INR 4,447 Cr deal. The shares were subject to a 12-month lock-in. Besides SoftBank, two other VC firms, Peak XV and Tiger Global, also received Zomato shares as part of Blinkit’s acquisition.

Investment firm Tiger Global also exited Zomato by selling 12.24 Cr shares, equivalent to a 1.44% stake, on Monday through open market transactions. Tiger Global’s Internet Fund III Pte Ltd sold the shares in multiple tranches at an average price of INR 91.01 per share, totaling INR 1,123.84 Cr, according to BSE bulk deal data.

In Q1 FY24, Zomato posted a consolidated profit after tax (PAT) of INR 2 Cr as against a net loss of INR 186 Cr in the corresponding quarter of the previous fiscal year.

The gross order value (GOV) of Zomato’s food delivery business stood at INR 7,318 Cr in Q1 FY24 as against INR 6,425 Cr in the corresponding quarter of the last fiscal.

The post SoftBank Looking At Full Exit From Zomato Following 1.17% Block Deal Sale appeared first on Inc42 Media.

Google has introduced its generative AI capabilities to Search in India. The Indian users will be able to toggle between English and Hindi and listen to results. The Search ads will continue appearing in dedicated ad slots throughout the page.

“Over the past few months, we’ve been experimenting with bringing generative AI capabilities into Search. We’ve learned a lot from people trying Search Generative Experience (SGE) in Search Labs, and we’ve also added new capabilities, from bringing videos and images into responses to local information and travel recommendations,” said Google.

According to the tech giant, users have responded positively to the inclusion of generative AI in Search, citing its ability to handle more complex queries and diverse types of questions.

“This generative AI experience helps people explore a range of perspectives and serves as a jumping-off point to explore web content,” said Google in the blog post. The tech giant added that it has been experimenting with easier ways for people to discover and visit the web pages that back up the information in AI-powered overviews. 

Users can find an arrow icon next to information in an AI-powered overview to see relevant web pages. “This is launching first in the US and will roll out to Japan and India over the coming weeks,” added Google.

In March, the tech giant, launched an experimental generative AI chatbot, Bard, to compete with OpenAI’s ChatGPT. 

Unlike ChatGPT, which relies on data up to September 2021, Bard uses different AI models and integrates current search results on data for more up-to-date information.

India has also had a smattering of startups using generative AI capabilities for use cases such as education, travel and other enterprise applications. The likes of Swiggy, Blinkit, Zomato, Freshworks, BYJU’S, ixigo, OYO and many others are either experimenting with generative AI capabilities or have already introduced products leveraging generative AI.

The post Google Brings Generative AI To Search In India appeared first on Inc42 Media.

On Wednesday, Zomato’s stock price soared by more than 5% in early trading after a block deal involving the foodtech giant. The shares reached a high of INR 99.50 each on the BSE.

According to Bloomberg data, a block deal on the stock exchanges saw approximately 10 crore Zomato shares, representing a 1.17% stake in the company, traded at an average floor price of INR 94.70 per share. The total value of this transaction amounted to around INR 947 Cr.

Following the conclusion of the lock-in period for Blinkit on August 25, Zomato Ltd. experienced a shift in its equity, involving 2.14% of its shares on Monday as well.

A total of 18.4 Cr shares were traded within a price range of INR 92.20 – INR 94.00 on Monday, as per Bloomberg’s data on major trades. The identities of the buyers and sellers are undisclosed at this time.

Last week, reports surfaced that SoftBank was contemplating the sale of additional Zomato shares via block trades.

SoftBank, which was also an investor in Blinkit, received Zomato shares when the latter acquired the quick-commerce startup in August last year in a deal worth INR 4,447 Cr. These shares were subject to a 12-month lock-in period.

Investment firm Tiger Global also exited Zomato by selling 12.24 Cr shares, equivalent to a 1.44% stake, on Monday through open market transactions. Tiger Global’s Internet Fund III Pte Ltd sold the shares in multiple tranches at an average price of INR 91.01 per share, totaling INR 1,123.84 Cr, according to BSE bulk deal data.

In Q1 FY24, Zomato posted a consolidated profit after tax (PAT) of INR 2 Cr as against a net loss of INR 186 Cr in the corresponding quarter of the previous fiscal year.

The gross order value (GOV) of Zomato’s food delivery business stood at INR 7,318 Cr in Q1 FY24 as against INR 6,425 Cr in the corresponding quarter of the last fiscal.

As part of its efforts to achieve profitability, the foodtech giant has broadened the reach of its platform fee, along with an increase in the fee. Initially, Zomato charged a fee of INR 2 per order for specific users. However, the company has now raised the platform fee to INR 3 for certain users residing in Tier II cities, as reported by Inc42. Meanwhile, the fee remains unchanged at INR 2 for the majority of users in metro cities.

The post Zomato Shares Jump Over 5% Amid Block Deal Buzz appeared first on Inc42 Media.

Following a recommendation from the Oversight Board (OB) based on a 2022 video depicting the sexual assault of a tribal woman in India, Meta has announced updates to its policy governing the posting of content related to sexual exploitation across its platforms.

What Does The New Policy Say?

The revised Adult Sexual Exploitation policy now permits sharing of content involving non-consensual sexual touching if posted by the victim or a third party with the aim of raising awareness. Such content will include a warning screen to inform users of its potentially disturbing nature.

“We may restrict visibility to people over the age of 18 and include a warning label on certain content depicting non-consensual sexual touching, when it is shared to raise awareness and without entertainment or sensational context, where the victim or survivor is not identifiable and where the content does not involve nudity,” Meta said.

Recommendation Of The Oversight Board

Last year, the Oversight Board reviewed a case referred by Meta involving a video that depicted an Indian woman being harassed by a group of men. The accompanying text on the Instagram post stated that a “tribal woman” was sexually assaulted and harassed publicly. The account that posted the video aims to share “stories from a Dalit’s desk.”

Originally, Meta removed the content for violating its Adult Sexual Exploitation policy. However, upon further review, Meta reinstated the post for users above 18, adding a warning screen.

“Meta usually removes content “that depicts, threatens or promotes sexual violence, sexual assault or sexual exploitation.” However, this case demonstrates the challenge in striking the appropriate balance between allowing content that condemns sexual exploitation and the harm in allowing visual depictions of sexual harassment to remain on our platforms,” Meta said while referring the case to the Oversight Board.

The Oversight Board recommended that Meta should include an exception in its ‘Adult sexual Exploitation Community Standard’ for depictions of non-consensual sexual touching when the content is shared to raise awareness, the victim is not identifiable, and the content does not involve nudity. “This exception should be applied at escalation only,” the Board added.

In its Q2 2023 Quarterly Update on the Oversight Board, Meta said that it has implemented the recommendation.

The Oversight Board is an independent body to which users can appeal if they disagree with Meta’s decisions on Facebook or Instagram. Established in late 2020, the Board recently announced that it would review more types of content moderation cases and expedite some decisions as it aims to expand its work.

The post Meta Modifies Sexual Content Policy Based On Oversight Board Recommendation appeared first on Inc42 Media.

According to a study conducted by the National Council of Applied Economic Research (NCAER) on the Indian gig worker ecosystem, the average real monthly income of food delivery executives in the country saw a drastic decline between 2019 and 2022. 

As per the findings, the average monthly real income of long-shift workers, working 11 hours a day, tanked to INR 11,963 at the end of May 2022, compared to INR 13,470.8 in 2019. 

Real monthly income accounts for inflation rates while nominal income does not adjust for the same. 

This fall was largely attributable to rising fuel costs and growing inflation, which emerged as a major factor for the high-attrition rate in the gig economy. 

“…it has become increasingly difficult to achieve daily/weekly targets over time… due to increased traffic and greater competition. On the other hand, fuel costs had (have) gone up… so workers have relatively little left,” the study noted.

The report also highlighted that the ability of long-shift food delivery workers to meet current household expenditures went down during the period under review. While noting that the surveyed gig workers were breaking even in 2019 and 2020, the report said that delivery executives found it difficult to eke out monthly expenditures from their income from delivery platforms due to rising fuel costs and inflation in the subsequent years. 

Another major takeaway of the report was that an Indian long-shift food delivery executive, working 11 hours a day, earned an average of $1.1 (INR 90.96) per hour. In contrast, a food delivery worker currently earns an average of $20.63 per hour in the US, according to another report. 

The findings were part of a telephonic survey conducted by the NCAER of 924 food delivery executives belonging to one particular food company spanning 28 Indian cities. The survey was carried out between April and May 2022 and the results were tabulated in a report — ‘Socio-economic Impact Assessment of Food Delivery Platform Workers’.

What stood out glaringly in the report was the mismatch between the skills required for the job and the qualifications of the workers. A third of the surveyed workers were found to have a graduation degree, while more than 12% of the respondents had a technical or a vocational degree (or diploma).

The study also highlighted the overarching dependence of workers on food delivery platforms. Consequently, nearly half (43.7% to be precise) of the surveyed gig workers were sole bread earners while another 20.6% were the primary breadwinners of their respective families. 

A Tiring Job, Nonetheless

Of the total respondents, gig workers undertook an average of 15.2 deliveries a day. Of this, 18.4 deliveries were done by long-shift workers while 10.3 deliveries were done by executives working on weekends or 5 hours a day. 

As per the report, the average base rate per delivery for active long-shift workers stood at INR 25.1, varying from city to city. Further, long-shift delivery executive made an average of INR 461.8 per day without incentives.

Besides, these surveyed delivery workers travelled an average of 95 km a day while making deliveries. For active long-shift workers, the number stood at 118 km, while the metric hovered around the 59 km mark for short-shift workers.

The study also highlighted the point that the Indian gig platforms have been able to formalise a large section of gig workers and bring them under the ambit of the social security net. It also noted that platform work largely generated local jobs with 70% of the surveyed workers operating out of their hometowns. 

Meanwhile, the NCAER, in its report, also urged the government to adopt a balanced approach while formulating policies to manage the flexibility of the gig ecosystem, along with improving the working conditions of workers.

“A balanced approach needs to be worked out so that the nature of the work is kept intact while simultaneously improving the condition of the workers. The answer lies in improving the social security of the workers and recognising their skills learned while working at the platform, which helps them to move on successfully,” the report added. 

The report also termed the government as the ‘best medium’ to provide social welfare support to gig workers, adding that consumer internet platforms may divert additional revenue to the authorities to finance social security initiatives in a centralised fashion. 

As India’s digital economy grows by leaps and bounds, it has also brought the focus on the condition of gig workers in the country, who operate outside the ambit of full-time employment offered by these platforms. These delivery executives are not offered similar rights as other regular employees and, as such, may or may not be able to avail social security benefits.

As per a NITI Aayog report, India was home to more than 7.7 Mn gig workers in FY21, a number that it projected to soar to 23.5 Mn by 2029-30. The NITI Aayog report then stated that gig workers would likely form 4.1% of the total livelihood in India by 2029-30. As such, the focus has turned to these platforms to offer equitable benefits to these workers. 

Questions have been raised, especially at a time when major startups such as Ola, Uber, and Dunzo scored a duck on Fairwork India Ratings 2022, on the working conditions of gig workers in India. Even growing incidents of gig workers meeting with accidents while on duty have also raised concerns about the need for the extension of social welfare benefits to the country’s  gig workers. 

With the country’s labour laws failing to do much for these workers, it remains to be seen how authorities develop a full-fledged regulatory framework to put the onus on the employers to enhance their standard of living. 

The post Rising Inflation, Fuel Costs Eat Into The Earnings Of Food Delivery Executives appeared first on Inc42 Media.

Japanese tech investor SoftBank is set to offload a 1.17% stake in Indian foodtech giant Zomato for at least INR 940 Cr. 

As per the deal terms, the investment firm’s affiliate SVF Growth Singapore plans to offload 10 Cr Zomato shares at a floor price of INR 94 per share, according to a CNBC report. This price represents a discount of nearly 0.7% compared to Zomato’s stock closing price on August 29.

As per the report, Kotak Securities will be the sole book runner for the deal. This comes days after reports said that the tech investor was looking to offload more shares of the foodtech major via block deals.

The development follows the expiration of the lock-in period for Blinkit investors, who received Zomato shares following the acquisition of the quick commerce player by the latter, on August 25. SoftBank, which was an investor in Blinkit, received a stake of 3.35% in Zomato post the acquisition last year. 

Even at the floor price of INR 94, SoftBank will still be able to book hefty profits as the implied value of the Zomato shares that it received following the Blinkit deal stood at INR 70.76 per share.

This is the second major Zomato investor selling a stake in the foodtech giant. Just yesterday, US-based hedge fund Tiger Global exited Zomato by selling 1.44% stake via open market transactions for INR 1,123 Cr.

The Japanese tech investor has realised exits to the tune of $5.5 Bn from its India portfolio since starting operations from Mumbai in late 2018. Of this, $1.5 Bn has been made through exits in the past 12 to 18 months.

The latest development comes amidst a wave of share sales by major global investment firms in new-age tech startups following a rise in their stock prices this year on change in investor sentiments.

Prior to this, Chinese tech investor Tencent sold 2.1% of its stake in PB Fintech, the parent of Policybazaar and Paisabazaar, for INR 562 Cr ($68 Mn). Chinese internet major Ant Group also dumped 3.6% stake in fintech giant Paytm for INR 2,037 Cr through multiple block deals earlier this month. 

Meanwhile, Zomato shares have been witnessing an uptick on the bourses on its improving financial numbers. The foodtech major reported a net profit of INR 2 Cr in the June quarter of 2023. On a year-to-date (YTD) basis, Zomato shares have zoomed 59.70%.

Shares of Zomato ended 2.51% higher at INR 94.65 on the BSE on Tuesday (August 29).

The post SoftBank To Sell 1.17% Stake In Zomato For INR 940 Cr appeared first on Inc42 Media.

Ahead of Asia Cup 2023, Ashneer Grover-led fantasy cricket platform CrickPe has unveiled subscription plans with zero platform fees. 

Called CrickPe Pro, the paid plans will be available in two denominations – INR 200 monthly pack and INR 1,000 yearly subscription. Users can simply top up their in-app wallets to avail the paid plans.

As per the app, CrickPe Pro users will not be liable for 10% platform fees on winnings and will get access to the ‘full pot with 0% admin fees’. Typically, real money gaming platforms earn revenue by charging a platform fee from users participating in games or tournaments on their platforms. 

Besides, the paid plans will also enable gamers to ‘share’ their teams and earn 5% extra on such winnings. However, it is not clear from the app as to what this offering entails.

Inc42 has reached out to Grover for a comment on the new offerings. The story will be updated with a response as and when it is received. 

The launch of the subscription plans comes close on the heels of the beginning of the biennial Asia Cup cricket tournament on August 30. The announcement could likely be a part of the company’s strategy to cash-in on the booming viewership during the tournament. 

The subscription plans could also likely be part of CrickPe’s strategy to create an alternate revenue stream. However, questions remain over whether the subscription plans would be enough to offset the revenue loss on account of the 10% platform fees waiver. It could all well depend on how well the product is received by users and economies of scale. 

In addition, the plans could also help CrickPe to attract more users and mount an attack against incumbents such as Dream11. 

Launched earlier this year, CrickPe is the brainchild of former BharatPe managing director Grover, his wife Madhuri Jain Grover and Aseem Ghavri. The platform debuted on app marketplaces just ahead of the start of the Indian Premier League (IPL) in March this year. 

Since then, the app has amassed more than 1 Mn downloads on Google Play Store. It is operated by the parent company Third Unicorn. The startup has so far raised nearly $4 Mn in seed funding led by ZNL Growth Fund.

In simple words, CrickPe allows users to create a virtual team of cricket players and earn cash prizes based on their performance in real life. 

The move comes at a time when the homegrown gaming industry has been reeling under the impact of the GST Council’s decision to impose 28% goods and services tax (GST) on the full value of the bets placed on online gaming. The new tax rate will come into effect from October 1. 

Following the government’s decision, many gaming startups have undertaken layoffs or temporarily shut operations. 

Despite the hiccups, the Indian gaming market continues to offer big opportunities for the startups and companies in the space. As per a report, the homegrown gaming market is projected to balloon to a size of $8.6 Bn by FY27 from a mere $2.6 Bn in FY22.

The post Ashneer Grover-Led CrickPe Unveils Subscription Plans Ahead Of Asia Cup appeared first on Inc42 Media.

Investment firm Tiger Global exited foodtech giant Zomato by selling 12.24 Cr shares, amounting to 1.44% stake, on Monday via open market transactions.

The firm’s Internet Fund III Pte Ltd sold the shares in multiple tranches at an average price of INR 91.01 Cr, as per the bulk deal data of the BSE. In total, Tiger Global sold the shares for INR 1,123.84 Cr.

French banking major Societe Generale lapped up a majority of the dumped shares (3.84 Cr). Kotak’s midcap fund, Axis Mutual Fund and Morgan Stanley Asia Singapore, BNP Paribas Arbitrage were the other buyers of the offloaded shares.

Tiger Global’s Internet Fund III held a 1.44% stake in Zomato at the end of June 2023, as per the foodtech major’s shareholding data available with the exchanges. 

Meanwhile, shares of Zomato were unaffected by the bulk selling, ending Monday’s session 1.53% higher at INR 92.33 on the BSE.

The share sale by Tiger Global came following the end of the lock-in period for Blinkit investors who received shares of Zomato after the acquisition of the quick commerce player by the latter last year. Apart from Tiger Global, global investors such as SoftBank and Peak XV (formerly Sequoia India) were bound by the lock-in period.

As per a report, SoftBank is also looking to offload Zomato shares following the end of the lock-in period. 

Zomato has seen a sort of financial reversal in the past few quarters. It posted a consolidated profit after tax (PAT) of INR 2 Cr in the first quarter (Q1) of financial year 2023-24 (FY24) as against a net loss of INR 186 Cr during the same period last year.

In addition, the company has also introduced a host of measures to spruce up its bottomline. Last week, Inc42 reported that Zomato has hiked the platform fee to INR 3 per order in some Tier II cities from INR 2 per order. 

The positive financial numbers have also resulted in a sharp rise in the company’s share price from the lows of 2022. Zomato’s shares are up 55.73% year to date.

The post Tiger Global Exits Zomato, Sells 12.24 Cr Shares For INR 1,123 Cr appeared first on Inc42 Media.

On Monday, following the conclusion of the lock-in period for Blinkit on August 25, Zomato Ltd. experienced a shift in its equity, involving 2.14% of its shares.

The Zomato shares acquired through the Blinkit deal were made available for trading.

A total of 18.4 Cr shares were traded within a price range of INR 92.20 to INR 94.00, as per Bloomberg’s data on major trades. The identities of the buyers and sellers are undisclosed at this time.

Among the investors subject to the lock-in period were names such as the Japanese tech giant SoftBank, along with venture capital firms Tiger Global and Peak XV (formerly known as Sequoia India). Out of these, SoftBank holds a 3.55% stake in Zomato, which was associated with an implied share value of INR 70.76 per share, at the time of the deal.

Shares of Zomato jumped over 5.5% to INR 96 in Monday’s trade on BSE.

Last week, reports emerged that SoftBank was considering offloading additional shares of foodtech giant Zomato via block trades.

SoftBank, which was also an investor in Blinkit, received Zomato shares after the company acquired the quick-commerce player in August last year in an INR 4,447 Cr deal. The shares were subject to a 12-month lock-in.

Two other VC firms, Peak XV and Tiger Global, also received Zomato shares as part of Blinkit’s acquisition.

Following Zomato’s financial turnaround, which saw the foodtech major achieve profitability in the April to June quarter, its shares have been on an upward trend since the end of March this year.

In its pursuit of profitability, the foodtech leader has expanded the scope of its platform fee to a broader user base and has also increased the fee. Originally charging a fee of INR 2 per order for select users, Zomato has raised the platform fee to INR 3 for some users in Tier II cities, according to information gathered by Inc42. Meanwhile, the fee remains at INR 2 for the majority of users in metro areas.

In Q1 FY24, Zomato posted a consolidated profit after tax (PAT) of INR 2 Cr as against a net loss of INR 186 Cr in the corresponding quarter of the previous fiscal year.

The gross order value (GOV) of Zomato’s food delivery business stood at INR 7,318 Cr in Q1 FY24 as against INR 6,425 Cr in the corresponding quarter of the last fiscal.

The post Zomato Shares Surge More Than 5% Amidst Reports of Block Deal Activity appeared first on Inc42 Media.

Short-video sharing platform Chingari has turned operationally profitable, Chingari CEO and cofounder Sumit Ghosh claimed. 

“We are finally profitable and will do business with our monthly revenues from now on. Not burning VC cash anymore or need to raise to sustain the business. We still have a few million USD left in the bank, which we have kept aside for the rainy days,” Ghosh claimed on Twitter.

The announcement comes at a time when Chingari has laid off more than 50% of its workforce in the second round of layoffs within two months. The layoffs impacted employees from product, customer support, design and marketing teams.

Navigating The Path To Profitability

In the startup’s early stages, he stated that the primary objective was rapid growth, regardless of cost. The startup invested heavily in acquiring users through inorganic means without giving much thought to revenue generation or a sustainable business model, he said. He was of the view that money would follow if Chingari was able to show growth. 

“In 2022 Markets turned, mid of 2022 even though we were growing at 500K downloads a day, no VC would take a bite as there was no clear monetisation plan. I realised this won’t lead us anywhere, reduced all inorganic media buys, focused on quality user acquisition, users who can be monetised,” Ghosh added.

At present, the startup is allocating less than INR 1 Cr per month for user acquisition, with a Customer Lifetime Value (LTV) to Customer Acquisition Cost (CAC) ratio of 4:1. Chingari kicked in monetisation strategy in May 2023 and anticipates improved financial metrics soon. According to Ghosh, profits generated each month will be reinvested to fuel further growth.

“When we raised funds, specially around GARI launch, we had raised lots of capital. We thought oh now we will become a big company, we need to hire professional people across the board, this was our biggest mistake, along with the good guys, we actually hired a bunch of corporate bozos who just came, did nothing, gave corporate Gyan and warmed chairs all day and left,” Ghosh said in his recent Twitter post.

Ghosh added that the Bengaluru-based startup eventually fired them due to low delivery, while the startup overspent on this talent pool.

He also acknowledged that building a D2C business and figuring out a viable business model is difficult in India as the companies have to pay Google or Facebook to acquire users, Google or Apple 30% tax on all the store billed payments, pay a GST on the income from users, among other expenses.

Last week, the startup laid off more than 50% of its workforce after firing 20% of its workforce in June. Chingari now has an employee base of 50-60 only following the latest round of layoffs. 

While it is cutting costs on employee expenses and finding more avenues to profitability, it recently became a digital partner of the UK-based Southall FC, an eighth-division football club. Chingari will offer a range of digital services to help enhance the club’s online presence and fan engagement.

Chingari In Troubled Waters

Founded in 2018 by Sumit Ghosh, Aditya Kothari, Biswatma Nayak and Deepak Salvi, Chingari rose to prominence after the Indian government banned Tiktok and other Chinese apps in 2020, citing security concerns. Earlier this year, its cofounder, Kothari, exited the startup.

At the beginning of this year, Chingari received an undisclosed amount of equity funding from Aptos Labs, the company behind the launch of Layer 1 blockchain Aptos. Last year, the short video startup secured $15 Mn in a funding round led by Republic Capital.

In October 2021, it introduced a crypto token named $GARI and a non-fungible token (NFT) marketplace. $GARI is the native token of Chingari and enables short-form video creators to monetise their content on the blockchain. As per CoinMarketCap, GARI was trading at a value of $0.01393 on Monday (August 28th), 98.67% down from its highest value of $1.05 in January 2022.

 This year, Chingari forayed into 18+ content with paid live one-on-one calls between creators and users to improve engagement and increase app downloads.

In an extensive investigation, Inc42 also found a series of recruitment posts for creators with promises of big payouts, in addition to several social media ads and videos featuring salacious promises.

The creators on the platform were found encouraging users to make 1-on-1 calls, and most users tend to accept them upon receiving an in-app gift. While it could be one of the ways to monetise the platform, the moral and ethical questions arise if Chingari can take this route.

In FY22, the startup reported a net loss of INR 139.4 Cr, a jump of 225.7% from INR 42.8 Cr in FY21. Meanwhile, the total income rose 137X to INR 49.4 Cr from INR 36 Lakh in FY21.

The post Chingari Claims Operational Profitability After Downsizing Staff appeared first on Inc42 Media.