 Morning Dispatch |
Stable policy push for ISM 2.0; Wipro misses Q1 estimates
Want this newsletter delivered to your inbox?
I agree to receive newsletters and marketing communications via e-mail
Thank you for subscribing to Morning Dispatch
We'll soon meet in your inbox.
Happy Friday! The government is leaning on policy stability, not just subsidies, to drive ISM 2.0. This and more in today’s ETtech Morning Dispatch.
Also in the letter:
■ Byju’s-Aakash deal eases
■ Ather QIP oversubscribed
■ ETtech Done Deals
The government has cut packaging subsidies under the newly launched $13-billion ISM 2.0 but is doubling down on building a full semiconductor and chip-design ecosystem in India aided by policy stability, officials from the ministry of information and technology (MeitY) told us.
Double click: The second phase of the semiconductor mission emphasises designing both commercial and strategic chips in India. The Centre will take minority equity stakes in Indian semiconductor startups, matching investments made by private venture-capital funds.
Incentives:
ISM 2.0 promises to ease early-stage funding hurdles for chip startups, but founders and investors told us that money alone won’t move the needle.
What to do: Startup founders and investors told ET that demand creation, talent development, faster policy execution and easier access to global semiconductor infrastructure will ultimately determine whether India can transition from a chip-design services hub to an IP-led ecosystem.
IT services major Wipro’s Q1 numbers missed expectations, with India’s fourth-largest IT company reporting modest revenue growth and flat profit.
Financials:
Guidance cut: Wipro lowered its second-quarter guidance versus the first quarter despite completing two acquisitions – Alpha Net Consulting and Mindsprint – during the quarter, citing demand uncertainty.
CEO’s take: “The demand situation in the market has not changed, and our pipeline is mostly on cost optimisation and vendor consolidation, with the clients taking the cost out for investment going into AI. The discretionary spend is becoming more intense, and that reflects our Q2 guidance,” CEO Srini Pallia said.
Tech Mahindra Q1 results: Tech Mahindra posted strong first-quarter growth in both profit and revenue.
The numbers:
Think & Learn has informed the National Company Law Tribunal (NCLT) that its committee of creditors has approved a proposed settlement in the long-running dispute over Aakash Educational Services, the most valuable asset in the collapsed Byju's group.
Case update:
Electric two-wheeler maker Ather Energy has received strong demand for its Rs 1,300-crore qualified institutional placement (QIP), with bids crossing Rs 10,000 crore, sources told us.
More on this:
Rahul Tandon, CEO, Naturis Cosmetics
Naturis Cosmetics raises Rs 100 crore: Naturis Cosmetics, which manufactures products for beauty and personal care brands such as Pilgrim, Plum, Nykaa's Kay Beauty, and Innovist's Bare Anatomy, has raised Rs 100 crore in its maiden funding round led by Sharrp Ventures.
PhysicsWallah to raise stake in Sarrthi IAS: Edtech firm PhysicsWallah will acquire an additional 11% stake in civil services coaching platform Sarrthi IAS for Rs 71.8 crore, taking its holding to 51% and making the company a subsidiary.
Rize raises $31 million: Sustainable agritech platform Rize has raised $31 million to expand its operations across Southeast Asia. The round consists of $20 million in equity and $11 million in debt financing, taking the company's total funding to $47 million.
UPI’s merchant fee revival: The government is likely to peg the merchant discount rate on Unified Payments Interface transactions at 5-7 basis points if the levy is reintroduced for large merchants, according to people aware of the matter.
■ IBM’s profit warning shows tech valuations are all in the timing (FT)
■ The problem AI content moderation cannot solve (Rest of World)
■ Meet GPT-Red: an LLM super-hacker OpenAI built to make its models safer (MIT Technology Review)
Also in the letter:
■ Byju’s-Aakash deal eases
■ Ather QIP oversubscribed
■ ETtech Done Deals
Chip sops slashed, but MeitY bets on policy stability to drive inflows
The government has cut packaging subsidies under the newly launched $13-billion ISM 2.0 but is doubling down on building a full semiconductor and chip-design ecosystem in India aided by policy stability, officials from the ministry of information and technology (MeitY) told us.
Double click: The second phase of the semiconductor mission emphasises designing both commercial and strategic chips in India. The Centre will take minority equity stakes in Indian semiconductor startups, matching investments made by private venture-capital funds.
Incentives:
- The initial manufacturing focus is on 28 nm and other legacy nodes, which account for about 80% of chip volumes today.
- Incentives for silicon fabs are now up to 40%, and up to 35% for other fabs, versus a flat 50% in phase one.
- Advanced packaging units will get up to 35% support; conventional packaging will receive up to 25%, with states free to top up.
ISM 2.0: Founders say demand, talent and execution key to scheme’s success
ISM 2.0 promises to ease early-stage funding hurdles for chip startups, but founders and investors told us that money alone won’t move the needle.
What to do: Startup founders and investors told ET that demand creation, talent development, faster policy execution and easier access to global semiconductor infrastructure will ultimately determine whether India can transition from a chip-design services hub to an IP-led ecosystem.
Wipro Q1 results: Profit flat at Rs 3,352 crore in June quarter
IT services major Wipro’s Q1 numbers missed expectations, with India’s fourth-largest IT company reporting modest revenue growth and flat profit.
Financials:
- Net profit: Up 1% year-on-year (YoY) to Rs 3,352 crore from Rs 3,330 crore.
- Revenue: Increased 11% YoY to Rs 24,479 crore from Rs 22,135 crore.
- Dividend: The board declared an interim dividend of Rs 2 per share.
Guidance cut: Wipro lowered its second-quarter guidance versus the first quarter despite completing two acquisitions – Alpha Net Consulting and Mindsprint – during the quarter, citing demand uncertainty.
CEO’s take: “The demand situation in the market has not changed, and our pipeline is mostly on cost optimisation and vendor consolidation, with the clients taking the cost out for investment going into AI. The discretionary spend is becoming more intense, and that reflects our Q2 guidance,” CEO Srini Pallia said.
Tech Mahindra Q1 results: Tech Mahindra posted strong first-quarter growth in both profit and revenue.
The numbers:
- Net profit: Rose 28% YoY to Rs 1,465 crore from Rs 1,140.6 crore.
- Sequentially: Profit increased over 8% from Rs 1,353.8 crore in the March quarter of FY26.
- Revenue: Grew 18% YoY to Rs 15,712 crore from Rs 13,351.2 crore.
Byju’s creditors clear Aakash settlement proposal
Think & Learn has informed the National Company Law Tribunal (NCLT) that its committee of creditors has approved a proposed settlement in the long-running dispute over Aakash Educational Services, the most valuable asset in the collapsed Byju's group.
Case update:
- The Bengaluru bench of the NCLT adjourned the case to August 18, giving the parties more time to complete the settlement.
- Counsel Ichchha Kalash said talks between Think & Learn, Aakash Educational Services, and Manipal Education and Medical Group are progressing, with creditors approving the proposal.
- ET had reported on June 22 that talks between Manipal Education and Medical Group and the GLAS Trust, representing Byju's US lenders, were at an advanced stage.
- The settlement aims to resolve the ownership dispute over Aakash Educational Services, in which Manipal Education and Medical Group, led by Ranjan Pai, holds about 58%.
- Think & Learn held 25.75% before Aakash's rights issue, which could have cut its stake to around 5%. However, GLAS Trust and Think & Learn's resolution professional raised objections.
Ather Energy's Rs 1,300-crore QIP subscribed over eight times: sources
Electric two-wheeler maker Ather Energy has received strong demand for its Rs 1,300-crore qualified institutional placement (QIP), with bids crossing Rs 10,000 crore, sources told us.
- The issue has been subscribed more than eight times.
- It opened at a floor price of Rs 1,169.70 per share, about 10% below Wednesday's closing price of Rs 1,298.
- Several domestic mutual funds and foreign institutional investors participated in the issue.
- Investors in the preferential allotment, including Hero MotoCorp and Ather's founders, are investing at around 7% above the QIP floor price.
Other Top Stories By Our Reporters
Naturis Cosmetics raises Rs 100 crore: Naturis Cosmetics, which manufactures products for beauty and personal care brands such as Pilgrim, Plum, Nykaa's Kay Beauty, and Innovist's Bare Anatomy, has raised Rs 100 crore in its maiden funding round led by Sharrp Ventures.
PhysicsWallah to raise stake in Sarrthi IAS: Edtech firm PhysicsWallah will acquire an additional 11% stake in civil services coaching platform Sarrthi IAS for Rs 71.8 crore, taking its holding to 51% and making the company a subsidiary.
Rize raises $31 million: Sustainable agritech platform Rize has raised $31 million to expand its operations across Southeast Asia. The round consists of $20 million in equity and $11 million in debt financing, taking the company's total funding to $47 million.
UPI’s merchant fee revival: The government is likely to peg the merchant discount rate on Unified Payments Interface transactions at 5-7 basis points if the levy is reintroduced for large merchants, according to people aware of the matter.
Global Picks We Are Reading
■ IBM’s profit warning shows tech valuations are all in the timing (FT)
■ The problem AI content moderation cannot solve (Rest of World)
■ Meet GPT-Red: an LLM super-hacker OpenAI built to make its models safer (MIT Technology Review)
Want this newsletter delivered to your inbox?
I agree to receive newsletters and marketing communications via e-mail