After multiple industry-changing events crippled the industry’s advancement last year, the positive shift is welcome, according to several industry players in the region.
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Salesforce introduced its AI layer called Einstein back in 2016 to provide predictive AI services across the Salesforce family of products. In March, just months after the release of OpenAI’s ChatGPT, it introduced Einstein GPT to bring the ability to ask questions about the software in natural language across the platform. Today, at the Dreamforce […]
CertifID, a startup developing fraud prevention tech for the real estate market, today announced that it raised $20 million in a funding round led by Arthur Ventures at “over double” its previous valuation. CertifID primarily develops products to fight wire fraud. The startup’s co-founder, Thomas Cronkright, launched the company in 2017 after losing $180,000 to […]
Following Zomato’s first ever profitable quarter in Q1 FY24, brokerage Bernstein has said the foodtech major is “raising the profitability bar” and increased the price target (PT) for the stock to INR 120 from INR 100 earlier.
In a research note on Tuesday (September 12), Bernstein said it believes Zomato can deliver long-term, high-teens growth in food delivery with continued improvement to contribution margins.
“The company’s strong execution (market leader, 55% share) & ‘profit beats’ has reinforced investor confidence,” said the analysts at the brokerage analyst in the research note.
“Zomato stock has graduated from ‘GMV multiple’ to ‘profit multiple’ as medium term EV (Enterprise Value)/ EBITDA multiple look reasonable. We shift to a profitability approach for valuing food delivery,” the report said.
Bernstein’s PT implies a 21.7% upside to Zomato’s close at INR 98.63 today on the BSE.
It must be noted that amid the increasing emphasis of retail and institutional investors on profitability, Zomato reported a net profit of INR 2 Cr in June quarter of FY24. Operating revenue stood at INR 2,416 Cr.
Food delivery business’ adjusted revenue grew 18.5% year-on-year (YoY) and almost 14% sequentially to INR 1,742 Cr in Q1.
In an attempt to further strengthen its food delivery business, Zomato has started charging a platform fee of INR 2 and INR 3 from most customers. Kotak Institutional Equities recently said this fee would increase the business’ customer take rate and contribution margin.
Since the June quarter results, shares of Zomato have surged 14%. The shares are up over 70% year to date (YTD).
Bernstein expects Zomato’s consolidated adjusted revenue to grow at a CAGR of 27% during FY24-FY30.
Meanwhile, brokerage Equirus Securities also initiated its coverage on Zomato yesterday with a ‘long’ rating and a PT of INR 135, which implies an upside of almost 37% to the stock’s last close. ‘Long’ is the highest rating of Equirus.
“Its (Zomato’s) dominance in the underpenetrated food delivery space should drive a robust 31% sales CAGR over FY23-FY28, making it one of the fastest growing players in India’s internet landscape,” said Equirus.
The brokerage believes that Zomato is enhancing customer and restaurant loyalty to its platform through its comprehensive suite of products, further solidifying its position as a key industry player.
Speaking on Zomato’s quick commerce business, the brokerage said it expects Blinkit to break even at the contribution level (post all variable costs) by FY24 and reach a contribution profit of INR 51 per order by FY28.
During its Q1 results, Zomato projected Blinkit to achieve breakeven on an adjusted EBITDA basis in the next four quarters.
“Blinkit’s success has stemmed from its understanding of product-supply chains, enabling seamless coordination between warehouses and dark stores… Its proprietary tech stack, tailored for supply chain operations, is the backbone of its efficient operations,” said the brokerage.
Shares of Zomato ended today’s session 2.7% lower at the BSE.
The post Bernstein Ups Zomato’s Price Target To INR 120, Says Foodtech Raising The Profitability Bar appeared first on Inc42 Media.
The International Monetary Fund (IMF) has reported that Guyana’s economy is set to expand by an impressive 38% in the current year, driven by a surge in oil wealth. This transformation is primarily due to massive offshore oil deposits discovered by Exxon Mobil Corp. in 2015.
Chargebee, the SaaS-based subscription management platform, has reportedly made another round of layoffs affecting approximately 10% of its global workforce, or about 100-120 employees, less than a year after a previous round of job cuts.
Chargebee’s CEO Krish Subramanian has cited “market shifts” as the primary reason behind the layoffs, sources reported.
“To position Chargebee for its next phase of efficient growth, and with the technology and market shifts underway across the industry, it is critical that we set up the organisation to focus on fewer priorities, with a greater emphasis on our customers’ experience and our core products,” Subramanian said.
The company has assured that it will adhere to labor laws in each affected country and provide severance packages to the impacted employees.
This recent downsizing comes after Chargebee reduced its workforce in November, citing macroeconomic factors and economic uncertainty as reasons for the cuts.
Headquartered in Chennai and San Francisco, Chargebee was founded in 2011 and offers a revenue growth management platform specializing in billing and subscriptions for both startups and large enterprises. Its customer base includes prominent names like Doodle, Calendly, Freshworks, and Okta, among others.
In its latest funding round, Chargebee raised $250 million, with Tiger Global and Peak XV Partners (formerly known as Sequoia Capital India) leading the investment. Other notable investors in this round included Sapphire Ventures, Insight Partners, and Steadview Capital. To date, Chargebee has raised a total of $470 million, establishing itself as a unicorn in the industry.
After a hiatus of two years, Elon Musk’s Starlink is on the verge of making a return to India, as it nears securing government authorisation to provide its satellite internet services in the nation.
According to a TOI report, a high-level meeting scheduled for later this month is expected to address Starlink’s proposal for a global mobile personal communication by satellite services (GMPCS) licence issued by the Telecom Regulatory Authority of India (TRAI).
Starlink is likely to receive approval, but chances are still there that any last-minute issues might delay approval.
The development comes nearly a year after the satellite internet company applied for a licence in October 2022.
Once Starlink secures the GMPCS license, it will need additional approvals from various government departments, including the Department of Space (DoS), before it can officially accept orders and move forward with its operations.
Starlink will join OneWeb and Jio’s joint venture with Luxembourg-based SES as a company having received the GMPCS licence in India. Jeff Bezos’ Project Kuiper is also likely to enter the Indian market shortly, per media reports.
However, India is also facing a fierce debate on whether or not an auction should be held to sell off airwaves required to operate satellite-based internet services in the country.
While Jio has been batting for an auction, calling for a ‘level playing field’ and citing the possibility of satcom companies offering voice and data services, others disagree. Starlink and OneWeb, on the other hand, are against an auction, calling for spectrum allocation and following the global trend. According to company letters made public by the Indian government in June, Starlink reckons an auction may impose geographical restrictions that will raise costs.
Starlink, a division of SpaceX, faced challenges when it entered the Indian market in 2021. The Ministry of Telecommunications reprimanded the company for commencing operations and accepting pre-orders without obtaining a licence.
For context, Starlink had received 5,000 pre-orders, at around $99 per order (INR 7,500 at the time) before the government stepped in and ordered the company to seek a licence and fully refund the pre-orders.
The Musk-led company has the largest satellite constellation deployed in the world. The company, which offers internet access across 56 countries, has put more than 4,500 satellites in Low Earth Orbit, 550 kilometres above the Earth’s surface.
The post Elon Musk’s Starlink Edges Closer To India Re-entry As Debate On Spectrum Continues appeared first on Inc42 Media.
LEAD, the edtech unicorn backed by Westbridge, has significantly reduced its losses and more than doubled its operating revenue in FY 2022-23 compared to the previous fiscal year. This impressive performance is attributed to robust business growth and a decrease in cash burn. In FY23, the Mumbai-based company reported a loss of Rs 321.9 crore, marking an 18.5% reduction from the Rs 395.3 crore loss recorded in the previous financial year. Meanwhile, its operating revenue experienced a remarkable surge of 106.4%, reaching Rs 273.2 crore in FY23, up from Rs 132.4 crore in FY22, as per its recent financial statements. The startup’s total income for the fiscal year ended in March stood at Rs 295.5 crore, a substantial increase from Rs 142.9 crore in the previous fiscal year.
“In the academic year 2022-2023, we observed a significant return of students to schools. Schools have recouped a portion of the fees from parents, resulting in their improved financial standings,” Sumeet Mehta, Co-founder and CEO of LEAD, said during a recent interview, implying that the financial health of schools directly impacts LEAD’s business.
LEAD’s overall expenditure in FY23 increased by 14.7% to Rs 617.4 crore, compared to Rs 538.2 crore in FY22. The largest expense category was employee benefits, with Rs 285.4 crore allocated, marking an 11.3% rise from the Rs 256.5 crore spent in the previous fiscal year. The company underwent layoffs in January, following a previous reduction of approximately 100 employees just a few months earlier.
On the expense front, the company’s stock-in-trade expenses increased by 40.6% to reach Rs 134.8 crore in FY23, while its other expenses, including items such as travel and conveyance, professional fees, and promotional and publicity expenses, decreased by 23.2% to Rs 137.1 crore in FY23.
LEAD also reported a significant reduction in cash burn, citing a decrease of 60-70% in FY23 compared to the previous fiscal year. Established in 2012 by Mehta and Smita Deorah, LEAD offers a comprehensive integrated system encompassing software, hardware, curriculum, books, school kits, and training sessions. It serves over 9,000 schools, 50,000 teachers, and five million students, with plans to add another 2,500 schools this year.
In early 2023, LEAD entered the high-fee school segment through the strategic acquisition of the local K-12 learning business of London-based firm Pearson, which was finalized in March. In July, LEAD announced its entry into the low-fee school segment in India, with the goal of improving learning outcomes for 25 million students across 60,000 schools by 2028.
According to Tracxn, LEAD has raised over $171 million, including a $20 million debt round in January and a $4.2 million debt round from Alteria Capital in December. In 2022, the edtech company secured $100 million in a Series E funding round led by WestBridge Capital and GSV Ventures, valuing the company at $1.1 billion.
Union road transport minister Nitin Gadkari said there is no proposal for increasing the GST on the sale of diesel vehicles. In a clarification issued barely two hours after he said that he would suggest the finance minister to increase GST by 10% on sale of such polluting vehicles, the minister said there is an urgent need to clarify media reports suggesting an additional 10% GST on the sale of diesel vehicles.