Also in this letter:
■ MapmyIndia IPO subscribed 2.02 times on day 1
■ Coming soon: India’s first pure-play climate tech fund
■ Italy fines Amazon $1.3 billion for abusing dominance
Treat crypto as special class of securities, CII urges government
The Confederation of Indian Industries (CII) said on Thursday that the government should treat cryptocurrencies as a special class of securities with its own regulations.
It said that existing securities regulations should not be applied to crypto and that “a new set of regulations would be appropriate, keeping in mind their jurisdiction-less and decentralised character.”
Context: The CII’s suggestion comes as the government is set to introduce the cryptocurrency bill in the ongoing winter session of Parliament. The bill seeks to prohibit all “private” cryptocurrencies in India and create a framework for India’s official digital currency to be issued by the Reserve Bank of India.
Since news of the bill’s imminent introduction in Parliament broke a few weeks ago, various crypto players and industry bodies have been lobbying the government. Two weeks ago the Blockchain and Crypto Assets Council (BACC), a part of the Internet and Mobile Association of India (IAMAI), said a blanket ban on cryptocurrencies would encourage non-state players, leading to more unlawful use of crypto. More on this below.
What else did CII say? It said the government should consider setting up a standing advisory council for crypto. Comprising representatives of regulators, policymakers, and other stakeholders, the council would advise the government on the challenges around cryptocurrencies and their regulation.
It suggested that the government establish centralised exchanges and centralised custody providers under the Securities and Exchange Board of India (Sebi). These exchanges would have to comply with KYC and anti-money laundering laws that apply to intermediaries in the financial markets.
CII also recommended tax reporting requirements for all crypto investors through specific disclosures in income tax returns.
Crypto lobbying: In a submission before the Supreme Court last month, the IAMAI listed several negative outcomes of a blanket ban on crypto, such as zero accountability and traceability of the origin and end-use, besides a complete evasion of taxes. A ban would also adversely affect retail investors, it said.
Like CII, the IAMAI also pushed for cryptocurrencies to be classed as assets and banned from being used as currencies. “The council has always argued in favour of prohibiting the usage of private cryptocurrencies as a currency in India… the council has advocated their use only as an asset,” BACC wrote.
MapmyIndia IPO subscribed 2.02 times on day 1
The initial public offering (IPO) of CE Info Systems, which runs MapmyIndia, opened for public subscription on Thursday with a price band of Rs 1,000-1,033 a share. The three-day issue will close on December 13 and the company’s shares are expected to list on exchanges on December 21.
Day 1 details: The offer was fully subscribed within a few hours and by the end of the first day of bidding, it was subscribed 2.02 times. The company received more than 1.42 crore bids across both the stock exchanges for the 70.45 lakh shares on offer.
Here’s the breakup:
- Retail quota: 3.28 times (3,522,381 shares on offer)
- Qualified institutional buyers quota: 0.46 times (2,012,789 shares)
- Non-institutional buyers quota: subscribed 1.17 times (1,509,592 shares)
IPO details: The IPO comprises only an offer for sale (OFS) of up to 10,063,945 equity shares by existing shareholders and promoters. This means the company itself will not receive anything from the IPO. On Wednesday the digital mapping company said it had raised Rs 312 crore from anchor investors ahead of the public issue.
No Razorpay IPO just yet: Meanwhile, RazorPay cofounder and chief executive Harshil Mathur said that an IPO, while very much in the company’s plans, was still a couple of years away. He said he wants to scale the company’s banking and lending arm before going public.
“If you want to go out and raise money in the public markets, it’s better to be a full-fledged financial ecosystem company, rather than just a payments company, which is a core part of our business today,” he said.
ETtech Done Deals
■ Consulting, technology and managed services provider to the Connectedness vertical, Prodapt announced that it has acquired SLR Dynamics, a UK-based company focussed on digital engineering and automation services in the TMT industry. The size of the deal was not disclosed. This is Prodapt’s second acquisition for the year following its acquisition of Silicon Valley-based Innovative Logic in August.
■ Direct-to-consumer personal and home care products startup Clensta on Thursday said it has raised Rs 20 crore funding from Hem Angels, part of Hem Securities Ltd, Venture Catalysts and Inflection Point Ventures. Existing investors N+1 Capital (RBF) and other investors also invested in the Series A round.
Tweet of the day
India’s first pure-play climate tech fund may kick off by end of March
As the world tries to fight the climate crisis, entrepreneur Harsha Moily and venture capital veteran Balaji Srinivasan are set to kick off what they claim will be India’s first climate technology-focused fund.
Nature-Fix Climate (NFC) Ventures, their Bengaluru-based fund, aims to close the first round of $80-$100 million by March 2022 and the rest by December, taking the overall fund size to $200 million. The fund is backed mostly by US-based investors, the co-founders told us.
Quote: “We have been able to get in principle commitments from five anchor LPs (limited partners) including an HNI, an ESG fund of a large Wall Street firm, and a climate-focused institution,” said Moily.
Tell me more: The fund will have a 12-year tenure, with the first five years earmarked for investments and the rest for follow-ons and exits, co-founder Srinivasan said. He has previously set up venture funds in India for Intel Capital, Carlyle and Abraaj, and led Abraaj’s investments in Big Basket and Care Hospital.
NFC Ventures will focus on investments in India, a consumer market for climate solutions, as well as invest in Israel, a hub for tech solutions, with an average ticket size of $5-15 million.
Hot topic: India has closely aligned itself with the global climate cause, and Prime Minister Narendra Modi even urged the G-20 countries at its recent meet in Italy to set up a clean energy projects fund, among others. In the past seven years, India’s installed solar energy capacity has increased 17 times.
Italy fines Amazon record $1.3 billion for abuse of market dominance
Italy’s antitrust watchdog today said it fined Amazon €1.13 billion ($1.28 billion) for alleged abuse of market dominance. This is one of the biggest penalties imposed on a US tech giant in Europe. Amazon said it “strongly disagreed” with the Italian regulator’s decision and would appeal.
Tech crackdown: Global regulatory scrutiny of tech giants has been increasing after a string of scandals over privacy and misinformation, as well as complaints from some businesses that they abuse their market power.
Watchdog’s view: Italy’s watchdog said in a statement that Amazon had leveraged its dominant position in the Italian market for intermediation services on marketplaces to favour the adoption of its own logistics service — Fulfilment by Amazon (FBA) — by sellers active on Amazon.it.
- “Amazon prevents third-party sellers from associating the Prime label with offers not managed with FBA,” it said.
Apple nears $3 trillion market cap: Meanwhile, Apple is within striking distance of a $3 trillion market capitalisation, a milestone that would make it as big as the world’s fifth-largest economy, below Germany, just over a year after breaching the $2 trillion mark.
Taking stock: Apple’s stock needs to trade at $182.85 to hit the mark and cap a strong rally that has been powered by investors betting on its brand and viewing it as a comparative safe haven.
The stock has jumped about 30% this year on top of an 80% surge in 2020. In comparison, the S&P 500 has risen 25% for the period.
Insta to launch chronological feed: Instagram said today that it aims to launch a version of the app with a chronological feed, rather than one ranked algorithmically, next year.
Instagram’s Adam Mosseri said the photo-sharing app had been working “for months” on the option of a feed ordered chronologically. The new feed will represent a significant change for the service, which – like almost all social media platforms – uses algorithmic ranking to personalise feeds based on users’ preferences.
Today’s ETtech Top 5 newsletter was curated by Arun Padmanabhan in New Delhi and Zaheer Merchant in Mumbai.
