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Byju’s second auditor BDO resigns after bankruptcy proceedings start

Ana Mary Joseph
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Byju’s second auditor BDO resigns after bankruptcy proceedings start
  • Byju’s calls for a forensic audit of BDO’s resignation to be conducted by insolvency professional.

The resignation of BDO Global, Byju’s auditor, marks a significant moment in the ongoing turmoil surrounding the Indian edtech giant.

Byju’s announced on Saturday that BDO’s subsidiary, MSKA, had stepped down due to a lack of adequate support from the company’s management in providing essential audit documentation for the financial year 2022-23.

The resignation follows the departure of Byju’s previous auditor, Deloitte, last year, which cited governance issues as its primary concern.

The crux of BDO’s resignation stems from its inability to obtain necessary information and explanations needed to complete the audit.

In its resignation letter, MSKA explicitly pointed out the inadequacy of support from Byju’s management. However, Byju’s has responded by asserting that the requested documents were directed to a suspended board of directors.

Contentious legal dispute

The board was suspended after Byju’s entered insolvency proceedings on July 16, 2024, due to a contentious legal dispute with the Board of Control for Cricket in India (BCCI), which subsequently led to the appointment of an Insolvency Resolution Professional (IRP).

In a statement, Byju’s clarified that the request for documentation came from BDO at a time when the board was not operational, and thus, the firm contends that the inquiry should have been directed to the appointed IRP.

Furthermore, Byju’s has called for a forensic audit of BDO’s resignation to be conducted by the insolvency professional, highlighting the company’s intent to address any discrepancies in the audit process.

Byju’s, once valued at $22 billion in 2022 and backed by investors such as General Atlantic, has experienced a dramatic decline in its market standing, primarily due to regulatory challenges and are in dispute with US banks regarding $1 billion in unpaid dues.

The situation has not only led to insolvency proceedings but has also resulted in a freeze on the company’s assets.

The departure of BDO, following Deloitte’s earlier exit, raises critical concerns about the governance and financial management of Byju’s.

As the company navigates these turbulent waters, it faces the daunting task of restoring investor confidence and addressing the myriad challenges that have culminated in its current financial predicament.

Electric vehicles in India ‘no longer needs subsidies’

Ana Mary Joseph
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Electric vehicles in India ‘no longer needs subsidies’
  • Country could become the largest exporter of lithium-ion batteries within next five years with increased EV production and local demand.
  • Electric vehicles benefit from a mere 5% tax compared to 28% imposed on internal combustion engine vehicles.

India’s Union Minister of Road and Transport, Nitin Gadkari, recently articulated a significant stance regarding subsidies for electric vehicle (EV) adoption in the country.

Speaking at the BloombergNEF Summit in New Delhi, Gadkari asserted that the time for further government incentives has passed.

His comments come on the heels of Minister of Heavy Industries H D Kumarswamy’s announcement regarding the imminent rollout of FAME-III (Faster Adoption for Manufacturing of Hybrid and Electric Vehicles) in the forthcoming months.

Gadkari pointed out a notable shift in the landscape of lithium-ion battery costs, which plays a crucial role in the pricing of electric vehicles.

He cited a substantial decrease from $150 per kilowatt per hour to approximately $107-$108 kilowatt per hour for batteries, projecting that costs could drop to $90 per kilowatt-hour within the next two years.

The reduction would equalise the cost between electric vehicles and traditional petrol or diesel vehicles, especially when considering the long-term savings on fuel; he emphasised that operating an electric vehicle would be ten times cheaper than its fossil fuel counterparts.

Moreover, Gadkari highlighted the increased demand for electric vehicles and the growing number of manufacturers entering the lithium-ion battery space. With these advancements, he believes the necessity for substantial subsidies has diminished.

A paradigm shift

Currently, there is a stark contrast in Goods and Services Tax (GST) levied on vehicles, with electric vehicles benefiting from a mere five per cent tax compared to the 28 per cent imposed on internal combustion engine vehicles.

The government’s previous initiatives, specifically the FAME-I and FAME-II schemes, were pivotal in incentivising the initial adoption of electric vehicles.

Launched in 2015 and extended through March 2024, these programmes collectively allocated significant financial resources to support the transition toward electric mobility.

Notably, the government, last month, extended the EMPS (Electric Mobility Promotion Scheme 2024) by two months till September 20, 2024, with an enhancement of outlay to Rs778 crore.

As the FAME-II subsidy ended in March 31, 2024, the government introduced the EMPS Scheme for four months from April 1, 2024 to July 31, 2024, with an outlay of Rs500 crore.

However, as the market and technology evolve, Gadkari’s statement suggests a paradigm shift away from dependence on subsidies.

The implication of this policy change could be significant for EV manufacturers in India, many of whom have relied on government incentives to stimulate growth in a still-nascent market. The marketing appeal of lower prices without heavy subsidies will challenge manufacturers to innovate and compete more vigorously.

Gadkari further highlighted India’s rise as the third-largest automobile manufacturer globally and predicted that the country could become the largest exporter of lithium-ion batteries within the next five years with increased EV production and local demand.

India’s EV maker Ather joins elite unicorn club

Mohammed Fahad
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India’s EV maker Ather joins elite unicorn club
  • Issues 165,28,925 Series G compulsory cumulative preference shares at an issue price of Rs363 each.

Ather Energy, a prominent manufacturer of electric scooters in India, has solidified its status as a member of the esteemed unicorn club following a substantial funding round that raised $71 million from the National Investment and Infrastructure Fund (NIIF).

The milestone reflects the growing interest and investment in sustainable transportation solutions as the world shifts towards greener alternatives.

The strategic move by Ather Energy involved the issuance of 165,28,925 Series G compulsory cumulative preference shares at an issue price of Rs363 each, aiming to accumulate Rs600 crore (approximately $72 million).

The financial maneuver has not only positioned Ather Energy with a post−allotment valuation of $1.25 billion but has also garnered significant backing from existing investors, notably Hero MotoCorp, which maintains its status as the largest external stakeholder with a 38.11 per cent ownership stake.

Competitive market

Despite these promising developments, Ather Energy faces challenges in an increasingly competitive electric two-wheeler market.

In the first quarter of fiscal year 2025, the company reported revenues of Rs339 crore but simultaneously incurred a net loss of Rs183 crore.

Ather’s market share in the electric two-wheeler segment decreased to 9 per cent, down from 11 per cent in the preceding fiscal year. In contrast, rivals such as Ola Electric and TVS Electric have experienced growth, with Ola commanding a significant 42 per cent market share in the same period.

The competitive landscape presents both challenges and opportunities for Ather Energy. As it navigates financial performance concerns and market share dynamics, its status as a unicorn underscores the potential for innovation and growth within the electric vehicle sector.

The continued support from investors like NIIF and strategic partnerships will be crucial as Ather Energy strives to regain market share and enhance its operational efficiency in a rapidly evolving marketplace.

Rapido secures $200m to expand its footprint and enhance service efficacy

Ana Mary Joseph
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Rapido secures $200m to expand its footprint and enhance service efficacy
  • Platform has already surpassed certain traditional four-wheeler services in particular cities, aspiring to secure its place as a significant player in the market.
  • Entering the burgeoning field of quick commerce delivery, leveraging its two-wheeler fleet for hyperlocal logistics.

Rapido, a prominent bike-taxi platform, recently announced the successful closure of a $200 million financing round, elevating its valuation to an impressive $1.1 billion.

The funding round was spearheaded by WestBridge Capital, which had previously invested $120 million in July, along with participation from several notable investors, including Nexus Venture Partners, Think Investments from San Francisco, and Invus Opportunities based in New York.

The co-founder of Rapido, Aravind Sanka, highlighted the company’s significant growth trajectory over the past year, noting a remarkable surge in daily rides, which now averages 2.5 million.

He expressed optimism regarding the investment’s role in driving innovation and enhancing service delivery, aiming to position Rapido as a formidable competitor in the transportation sector.

Notably, the platform has already surpassed certain traditional four-wheeler services in particular cities, aspiring to secure its place as a significant player in the market.

Enters e-commerce delivery

Rapido operates across various vehicle segments, processing between 2.3 to 2.5 million orders daily, with a noteworthy seven per cent derived from business-to-business transactions.

 The three-wheeler auto-rickshaw segment contributes the largest share of the company’s gross merchandise volume, accounting for 40 per cent, while bike taxis and cab services each make up 30 per cent.

Despite these distributions, two-wheeled transportation remains the predominant choice for over half of the rides, underscoring the importance of this segment in Rapido’s operations.

In a strategic expansion of its business model, Rapido is entering the burgeoning field of quick commerce delivery, leveraging its two-wheeler fleet for hyperlocal logistics.

Sanka has indicated that the company is engaging with leading quick commerce and e-commerce entities to bolster this initiative.

The fresh capital will be pivotal for Rapido as it aims to broaden its operational footprint across India and refine its technological infrastructure to enhance service efficacy.

With plans to diversify further into bike-taxis, auto-rickshaws, and traditional taxis, Rapido is positioning itself not only as a leader in bike-taxi services but also as a versatile player in the broader transport ecosystem.

Despite its expansive growth, Rapido has faced challenges, recording a significant rise in losses by nearly 54 per cent in FY23, totaling Rs675 crore, compared to Rs439 crore in FY22. These losses have been attributed to increased operational costs, including rider compensation and technology investments. Nevertheless, the assistance from key stakeholders such as Swiggy, which previously invested $180 million in April 2023, signals robust confidence in Rapido’s potential.

Established in 2015, Rapido has rapidly extended its reach beyond major metropolitan areas, now servicing over 100 cities across India, including tier 2 and 3 locations.

The company’s growth narrative reflects a combination of operational excellence and an unwavering commitment to customer satisfaction, as noted by Sumir Chadha, co-founder and Managing Partner at WestBridge Capital.

Lendo aims to bridge financing gap for SMEs in Saudi Arabia

TCN Bureau
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Lendo aims to bridge financing gap for SMEs in Saudi Arabia
  • Saudi Vision 2030’s goal is to significantly expand SME lending from 4% in 2018 to 20% by 2030.

Saudi Arabia-based Shariah-compliant crowdlending marketplace – Lendo – has signed a Memorandum of Understanding (MOU) with J.P. Morgan to improve access to financing for small and medium-sized enterprises (SMEs) across the country. 

J.P. Morgan and Lendo are working together on potential opportunities to support the SME sector in Saudi Arabia in growing and sustaining the remarkable demand in this market.

“This strategic collaboration with J.P. Morgan, a pioneer in the financial industry, marks a significant milestone for Lendo,” Osama Alraee, CEO and co-founder of Lendo, said.

“By combining our strengths, we’ll deliver cutting-edge financial solutions to SMEs, supporting their growth and contributing directly to the realisation of Saudi Arabia’s Vision 2030.”

The SME financing landscape in MENA presents a substantial market opportunity as limited financial access continues to restrict the growth of the region’s businesses, with commercial banks hesitant to issue loans to SMEs at scale, resulting in a high percentage of declined financing requests annually.

The total SME financing gap in developing countries is estimated to be approximately $5.2 trillion, according to the International Finance Corporation (IFC).

Lendo’s debt crowdfunding platform aims to bridge the financing gap for SMEs, aligning with Saudi Vision 2030’s goal to significantly expand SME lending from 4 per cent in 2018 to 20 per cent by 2030.

According to the latest available report from the Saudi Central Bank (SAMA), the total value of debt crowdfunding in Saudi Arabia surged from 1.4 million Saudi riyals (SAR) in 2019 to SAR 771 million in 2022, marking a remarkable growth.

Lendo raised 132 million Saudi riyals ($35.2 million) in total funding from leading investors, including the most recent Series B led by Sanabil Investments, a wholly-owned company by the Public Investment Fund (PIF).

Since its inception in December 2019, Saudi fintech Lendo has processed over 5,000 financing transactions on its platform, providing over SAR 2 billion ($600 million) in financing to SMEs and generating SAR 280 million ($74 million) in returns for investors.

Will Apple Intelligence usher in a new era for smart devices?

Naushad K. Cherrayil
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Will Apple Intelligence usher in a new era for smart devices?
  • Unlike its competitors, Apple has succeeded in portraying AI as a personalised enhancement to the user experience, transforming it from a luxury into a necessity.
  • Integration of ChatGPT into Siri signifies a substantial leap in the capability of Apple’s voice assistant.
  • Incorporating AI into Apple’s ecosystem presents monetisation opportunities across both services and hardware.
  • Apple’s focus should be on delivering a tool that is user-friendly, accurate, and genuinely enhancing consumer experience.

Even though Apple will be launching its 10th anniversary edition of the Apple Watch, iPhone 16 lineup and updated AirPods on September 9th, all eyes will be on Apple’s generative AI-powered – Apple Intelligence – platform.

The generative AI-powered initiative marks Apple’s significant stride toward integrating advanced artificial intelligence capabilities into the daily lives of consumers using iPhones, iPads, and Macs.

While Apple is not the first smartphone manufacturer to adopt AI technology—competing devices like Google’s Pixel and Samsung’s Galaxy already offer such capabilities—it is arguably excelling in marketing its AI offerings.

The company’s presentation at its June developer conference illuminated how Apple Intelligence interlinks seamlessly with the existing ecosystem of Apple apps and services.

Unlike its competitors, Apple has succeeded in portraying AI as a personalised enhancement to the user experience, transforming it from a luxury into a necessity.

Unlocking potential demand

Apple Intelligence is not merely an addition; it is a core selling point for the upcoming iPhone 16 models. With the software designed exclusively for the iPhone 15 Pro and newer devices, Apple positions this AI integration as vital for unlocking potential demand for the iPhone, particularly as the replacement cycle hovers around 4.8 years, according to Morgan Stanley analyst Erik Woodring.

The infusion of AI features—ranging from summarising text message threads and prioritising emails in the Mail app to an improved Siri experience—highlights Apple’s commitment to enhancing user convenience and efficiency.

The anticipated rollout of iOS 18, coinciding with the launch of the iPhone 16, will introduce initial AI features, while the more advanced functionalities of iOS 18.1, including email summarization and suggested replies in the Messages app, are expected later this year.

Additional innovative features, such as Image Playground and Genmoji—custom emojis—will also be introduced, illustrating Apple’s ongoing dedication to evolving user experience through AI.

Furthermore, the integration of ChatGPT into Siri signifies a substantial leap in the capability of Apple’s voice assistant. By enriching Siri’s language understanding and responsiveness, users can expect a more interactive and context-aware experience.

For example, Siri will have enhanced abilities to manage calendars, photos, and messages to provide tailored responses, fundamentally transforming interaction efficiency.

Challenges persist

Despite these promising advancements, challenges remain. The deployment of features may encounter regulatory hurdles, particularly in the EU and China, and users with older devices will be left out due to the necessary hardware requirements.

Moreover, while the buzz surrounding AI is palpable, the initial launch may experience technical glitches typical of nascent technologies. This uncertainty was acknowledged by Apple CEO Tim Cook, who admits reservations about the potential for AI to produce inaccurate results.

This candid admission highlights a significant challenge: the potential for AI systems to generate misleading or erroneous information, commonly referred to as “hallucination.”

However, it is crucial to acknowledge that, like any nascent technology, this system may encounter initial glitches upon its release. AI models fundamentally rely on data for functionality; thus, the quality and reliability of outputs are directly tied to the sophistication of the underlying architecture and training data.

Reliability and utility

In a practical context, users engaging with Apple Intelligence—particularly through Siri—should remain prudent. If one is relying on AI to confirm flight details, it may be wise to consult the airline’s official website for verification, rather than placing complete trust in automated dialogue.

As explained by Camden Woollven, an expert in AI, direct engagement with ChatGPT sends queries straight to OpenAI’s servers, whereas Siri will act as a privacy-conscious intermediary, an aspect that might attract consumers who prioritize data protection.

From a financial perspective, Wedbush analyst Dan Ives posits that incorporating AI into Apple’s ecosystem presents monetisation opportunities across both services and hardware.

However, consumer enthusiasm will not stem from potential profits alone. Apple must ensure that its AI offering is not merely an obligatory addition to its repertoire, aimed at appeasing investor concerns about market relevance. Instead, the focus should be on delivering a tool that is user-friendly, accurate, and genuinely enhances the consumer experience.

Drawing lessons from the pitfalls of competitors’ AI products—such as Google’s AI that infamously suggested absurd culinary advice—Apple must take meticulous measures to refine its application, ensuring that it does not become synonymous with erroneous outputs.

Ultimately, the success of Apple Intelligence will be measured not only by its technological prowess but also by its ability to serve a meaningful purpose in the lives of its users, confirming that innovation must go hand in hand with reliability and utility.

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