The reopening of schools and colleges has sparked a crisis in the edtech sector with falling valuations, slowing funding rounds and faltering investor sentiment. In a totally altered, post-pandemic landscape where students are back at school and colleges, companies are scrambling to revert to bricks-and-mortar tuition centres and adopting a hybrid model of offline and online education. Demand for online tuition has fallen, affecting the revenue of edtech companies in recent months. After two years of booming revenues, some experts say the sector is looking at a possible meltdown.
This year, festive sales are expected to push up the annual gross merchandise value of e-commerce companies to around $38 billion, a 40 per cent growth over the previous year.
Instead of making the sellers bleed, experts say, e-commerce giants Amazon and Flipkart have roped in banks to offer discounts to buyers.
Having grown swiftly since the acquisition of Flipkart by Walmart in 2018, it was looking at a valuation of $10 billion. However, factors such as lack of diversification, new e-commerce and data policies, as well as the overall investment environment, have slowed the process.
India is currently home to 52 unicorn startups and one of the fastest-growing startup ecosystems.
There seems to be no dearth of funds to fuel this growth, report Peerzada Abrar and Shivani Shinde.
Amazon's fresh investment in its India entities come at a time when the Seattle-based firm has faced losses in several of its business entities in India, such as seller services, wholesale, transportation services and digital payments, for the 2018-19 financial year.
India's shift towards US companies for technology investments and partnerships fits well with the present government's 'Atmanirbhar Bharat' and 'Make in India' initiatives, say experts.
The aim is to replace nearly 40 per cent of its existing last mile fleet of delivery vans with EVs by March 2020. o start with, the company is looking at deploying nearly 160 e-vans by the end of 2019.
A slew of Indian firms, including Flipkart, Byju's and Zomato, is building a path to profitability and diversifying into newer business segments ahead of mega-IPO plans.
Apart from making your purchases on these platforms expensive, it will also mean sellers will have to face the brunt of reduced cash flows amid already low margins for some. Experts said the proposal, which will take effect on April 1, 2020, and will be inserted as a new section in the Income Tax Act, is expected to affect the working capital of e-commerce companies and reduce cash flows for e-sellers.
The lockdown that crippled the entire logistics, delivery and supply chain network to near zero, was enough to deal a body blow to India's fastest growing unicorn whose very business model saw a severe disruption, like several other firms and sectors.
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