The edtech gold rush in India continues as the Masayoshi Son-led Japanese conglomerate looks to make its first bet in the country this year.
Meanwhile, Amazon India is foraying into home delivery of medicines as the sector gears up for a big wave of consolidation.
SoftBank may back Unacademy
Unacademy is finalising a deal to raise around $150 million funding led by Japanese conglomerate SoftBank, at a pre-money valuation of $1.3 billion, sources in the know of the matter told ET.
The fundraising comes on the back of Unacademy’s strong growth caused by the spike in the number of online learners in India due to the Covid-19 pandemic. It will also make the Bengaluru-based firm India’s second most valuable edtech firm after Byju’s, which recently raised capital from Mary Meeker’s Bond Capital at a valuation of $10.5 billion.
Edtech deal flow
- Vedantu has raised $100 million led by US-based Coatue Management with participation from existing investors Tiger Global, GGV Capital, Omidyar and Westbridge Capital.
- Toppr has raised Rs 350 crore financing led by Gulf-based investment firm Foundation Holdings with participation from Kaizen Private Equity and other “long-time partners”
- ByteDance is in talks to potentially invest in Mumbai-based education technology firm Lido Learning.
Amazon’s pharmacy foray
Amazon has forayed into prescription medicine delivery service with its new service Amazon Pharmacy, starting in Bengaluru. This will allow customers to order prescription medicines, over-the-counter drugs, ayurvedic medication, as well as basic medical devices.
Consolidation in e-pharmacy sector
This launch comes at a time when the e-pharmacy sector in India is gearing up for a big wave of consolidation, triggered by Reliance Industries’ reported acquisition of Chennai-based Netmeds, while other leading players like PharmEasy and Medlife have also explored merger and acquisition negotiations. Global investors are also lining up to back the winners in the fast-growing sector.
The e-pharmacy sector is witnessing a spike in demand amid the pandemic, as consumers choose to buy medicines online from the safety of their homes
Amazon’s food delivery launch
This is the second big online sector Amazon is entering this year, after having launched its food delivery service ‘Amazon Food’ in May in select localities in east Bengaluru. The company said it plans to expand to other cities in the coming months.
Online smartphone sales trends
In a first, Amazon has emerged as the largest smartphone sales channel with a 47% market share in Q2 2020, surpassing Walmart-owned Flipkart that had a 42% market share, according to data from market research firm Counterpoint. Smartphones are typically among the largest sales drivers for ecommerce firms, and traditionally, Flipkart has led online phone sales for several quarters.
Other key takeaways
- 43% of Q2 2020 smartphone sales were online. Expected to grow to 45% in 2020.
- Xiaomi remains the market leader in online sales with 44% share, while Samsung’s share touched 25% in online sales, its highest ever in a quarter.
- Top five smartphone brands captured more than 88% of the total online market.
- Offline channels captured 57% share and are expected to do better in the second half of 2020.
Beleaguered domestic phone maker Micromax is eyeing a re-entry into India’s hyper-competitive smartphone market and plans to invest Rs 500 crore towards manufacturing and R&D.
The company was the second-largest smartphone player in India in 2014, however, it was not able to compete with the onslaught of Chinese players, both in terms of pricing and marketing budgets. It bowed out of the smartphone market two years ago, to function as a contract feature phone manufacturer for other brands.
“The new PLI scheme balances out foreign and Indian players. With government support, we will be able to fight Chinese brands fiercely on the pricing front. PLI is a solid backing,” co-founder Rahul Sharma told ET.
‘Country of origin’ tag
Ecommerce industry associations have sought at least 6-7 additional months to comply with the new consumer protection rules, including one that requires e-tailers to mandatorily display the ‘country of origin’ of goods.
The rules, which were notified on July 23 and came into effect immediately, also direct ecommerce marketplaces and sellers to appoint grievance officers, who will have to resolve consumer grievances within one month of getting a complaint.
What are companies doing?
Flipkart and Snapdeal are understood to have mandated disclosure of ‘country of origin’ for all new listings on their platforms.
Amazon had told sellers in an email last month that the ‘country of origin’ requirement would be mandatory for listing products on its platform and had set August 10 as the deadline for sellers to update their existing listings.
Flipkart eyes alcohol delivery tie-up
Flipkart has partnered with Diageo-backed HipBar to deliver alcohol in two Indian states including West Bengal and Odisha, Reuters reports citing government letters.
As per the deal, Flipkart customers will reportedly be able to access HipBar’s application on its platform and place orders. HipBar will then collect the products from retail outlets and deliver to customers.
Rival Amazon and e-grocer BigBasket had also received approval from the West Bengal government in June while Swiggy and Zomato started delivering alcohol in a few cities from May this year. Retailers across several states, however, had raised concerns on this move, saying it will reduce their margins as well as possibly hurt their customer database. Read more.