Also in this letter:
■ ETtech Deals Digest
■ Blinkit’s festive season rush on Dhanteras
■ Infographic Insight: Festive season to create frontline jobs
Programming note: We’ll be off for the next few days. ETtech’s daily newsletters will be back on November 15. Wishing all our readers a bright and prosperous Diwali. 🪔 🪔
Ranjan Pai books an Aakash seat with Rs 1,400 crore to clear Davidson Kempner debt
Manipal Education and Medical Group chairman Ranjan Pai
Ranjan Pai, chairman of Manipal Education and Medical Group, has invested Rs 1,400 crore (approximately $168 million) in Byju’s test-prep subsidiary, Aakash Institute. This investment is to clear the company’s debt to US-based lender Davidson Kempner Capital Management, according to sources familiar with the matter.
Loan details: In May, Byju’s entered into a structured credit deal worth Rs 2,000 crore ($240 million) with Davidson Kempner, using the cash flows of Aakash Institute. However, Byju’s received only about Rs 800 crore ($96 million) in two tranches, after which it breached a loan covenant.
Pai matters: He is likely to get two board seats at Aakash as part of the investment and will be approaching the antitrust regulator soon.
Gain for Davidson: Out of the Rs 1,400 crore being transferred to Davidson Kempner, Rs 800 crore is the loan amount, while the remaining Rs 600 crore accounts for interest. This is a 75% gain for the US lender.
Pai-Chaudhry connection: Pai’s investment in Aakash coincides with Aakash Chaudhry’s completion of the share-swap in Byju’s parent company, Think and Learn, as per the initial deal announced two years ago. Chaudhry, Aakash’s promoter, is set to return as CEO. ET had reported on October 12 that Pai was in talks with private equity firms to invest in the coaching business once the share-swap was done.
In the next 30-45 days, Pai is expected to finalise ongoing investment discussions for Aakash, securing a projected 25-30% stake in the company. His investments will be towards Aakash and not Think and Learn.
Read ETtech’s detailed coverage on the developments at Byju’s
HP, Lenovo among companies likely to get PLI nod soon
The Centre is likely to approve 10 IT hardware manufacturing proposals from the 40 that it has received under the production-linked incentive (PLI) scheme, sources told ET. Companies whose proposals have not made the cut have been asked to submit reworked applications with more details.
Who made the cut? Proposals from HP India, Lenovo India and Flexotronics are likely to be approved. Padget (Dixon Technologies), VVDN, Netweb, Syrma, Optiemus and Kaynes Tech are some of the other significant companies that may also make the cut.
Tell me more: An official said that in the coming days, 20 more companies are likely to receive approvals under the scheme. “Our aim is (to approve) up to 30 companies, which will be necessary for the products to have critical mass not just in India but in international markets as well.”
More investments: In August, the government had said that it had received proposals from 40 companies with expected incremental investments of Rs 5,010 crore. This was towards additional production worth Rs 4.65 lakh crore over six years, including exports of Rs 28,288 crore during the period.
ETtech Deals Digest: Weekly funding up on year at $167 million, but dips sequentially
The funding climate for Indian technology startups improved year over year, with $166.9 million deployed across 15 funding rounds in the week of November 4-10, according to data from Tracxn.
In the comparable week in 2022, startups had raised $133 million across 21 funding rounds. The deals this week averaged about $11.13 million each, versus $6.33 million per deal in 2022.
Sequentially, the week saw a 29% decline in terms of total volume, and a 207.5% rise in value terms. The ongoing funding winter began to set in from September 2022
Read about the top deals of this week here
Infographic Insight | Online festive season to create 2.5 million frontline jobs
The current festive season is anticipated to log a 72% year-on-year increase in demand, generating new employment opportunities as businesses scramble to meet the surge in demand, per a report by SaaS platform BetterPlace.
Quote unquote: “The festive season is a big opportunity for frontline workers. Moreover, we are seeing that industries that hire semi-skilled workers pay salaries that are higher than those of industries that hire unskilled workers,” said Pravin Agarwala, cofounder and Group CEO, BetterPlace.
Sales off to a bright start: We had earlier reported that Flipkart and Amazon India—the two largest ecommerce players in the country—had both indicated that their festive sales had begun on a bright note.
Sources told us that Flipkart is on course to clock around Rs 33,000-36,000 crore in gross merchandise value (GMV) during the ongoing festive season sale. This will mark an increase of 15-20% from the GMV recorded by the ecommerce major in 2022.
Dhanteras: Sales of gold coins, silver coins and brooms surge on Blinkit
Zomato’s quick-commerce arm Blinkit witnessed a significant increase in sales of gold and silver coins, along with other Dhanteras-related items on Friday, signifying a shift in how India is shopping for festivals.
Why the surge? Dhanteras, or Dhanatrayodashi, which happens to fall on November 10 this year, marks the beginning of the Diwali festival in various regions across the country. It is considered auspicious to buy items made of gold, silver and brass on this day, as they are believed to bring prosperity and success into people’s lives.
“Dhanteras muhurat (auspicious time) hasn’t even started and we’re already close to hitting half of the gold and silver coins sales from last year,” Blinkit CEO Albinder Dhindsa wrote on X.
Things in demand: In addition to the uptick in gold and silver coin sales, there has been a notable increase in the purchase of brooms, considered auspicious during this time, Dhindsa added.
“We learned that it is auspicious to buy jhadu (brooms) today when brooms got stocked out at all our dark stores on Dhanteras 2 years ago,” Dhindsa wrote.
Fresh flowers and leaves were another high-selling category for Blinkit, said Dhindsa.
Products like steel utensils and home electronics were also among those experiencing increased demand on quick-commerce platforms.
Today’s ETtech Top 5 newsletter was curated by Megha Mishra in Mumbai and Siddharth Sharma in Bengaluru.
