Also in this letter:
■ IT firms expect operating margins to jump as attrition falls
■ Won’t spare Byju’s if guidelines have been violated: NCPCR chief
■ IT ministry pushes deadline for public feedback on data bill to Jan 2
Indian ecomm grew 36.8% in 2022 amid receding pandemic: report
India’s ecommerce industry recorded 36.8% year-on-year growth in 2022 although more shoppers returned to the physical stores as Covid-19 fears receded, according to ecommerce enabler Unicommerce.
Unicommerce’s data is based on analysis of more than 500 million transactions. It does not include the data related to sales of mobile phones and smartphones.
By the numbers: Tier-3 markets like Udaipur, Roorkee and Rohtak grew by 64.7% in 2022 year-on-year, while tier-2 markets like Bhopal, Amritsar and Bhubaneshwar clocked an impressive 50.9% growth.
Order volumes from tier-1 cities recorded a 10.3% growth in 2022 compared with 2021.
Thus, tier-2 and 3 cities not only accounted for a majority (nearly 63%) of total orders placed by users, but both also grew much faster than the tier-1 markets.
In an interaction with ET on September 16, Flipkart Group CEO Kalyan Krishnamurthy had said that India’s top 10 cities are now a relatively small part of Flipkart’s total business and the next 30-100 cities are driving the majority of the growth for the Bengaluru-based firm.
Beauty, eyewear surge: Beauty and personal care, and eyewear were the fastest growing categories, while fashion and apparel continued to lead in terms of order volumes.
The beauty and personal care, and eyewear and accessories segments saw year-on-year order volume growth of 76.6% and 55% respectively.
We reported on January 3 that the beauty and personal care category will be the fastest growing category this year as new-age internet brands like Sugar Cosmetics and Mamaearth try to take away share from traditional brick-and-mortar players like Lakme.
IT firms expect operating margins to jump as attrition falls
The operating margins of Indian IT majors are expected to improve as attrition — a major factor behind the drop in profitability for the last few quarters — is seeing a significant drop as the demand cycle is expected to moderate and industry wide layoffs have cooled the job market.
Attrition eases: According to experts, the attrition or number of employees leaving in the last 12 months has come down in the range of 17-18% across the tech industry.
The top management of IT majors such as Tata Consultancy Services, HCLTech and Tech Mahindra told us there is a fall in the attrition percentage on quarterly basis and it could translate into better operating margin and delivery of services.
The top IT companies are set to announce their financial results for the December quarter starting from TCS on January 9.
Yes, but: The last-twelve-month (LTM) attrition number, which is published by top companies along with quarterly results, will still remain high in the near term for Indian IT companies before tapering off as it is calculated on an annualised basis.
Attrition had touched unprecedented levels going up to even the 30% mark for some companies due to the pandemic driven demand of digitisation projects. It had led to significant strain on the margins of companies who were forced to hire replacements at higher wages and spend more on training costs.
Won’t spare Byju’s if guidelines have been violated: NCPCR chief
The National Commission for Protection of Child Rights (NCPCR) will seek accountability from Byju’s in the wake of allegations that the edtech firm had violated guidelines, chairperson Priyank Kanoongo told us.
Catch up quick: On Friday, the NCPCR had summoned the Bengaluru-based startup’s CEO, Byju Raveendran, over allegations of malpractice by the company’s sales team, which allegedly lured parents into buying Byju’s courses for their children.
The summons cited a claim in a media report by the company’s customers, who said they had been exploited and deceived by the K-12 online tutor, eroding their savings and putting their future in jeopardy.
“We had got this complaint earlier as well. This is not the first time. Last time, we had simply written to the Ministry of Education. After this, the Ministry of Education released guidelines,” Kanoongo told us.
Hearing next week: The commission has asked Raveendran to appear in person before it at 2pm on December 23 to respond to the allegations.
It also instructed him to provide details of all the courses run by Byju’s for children, the structure of these courses, fee details, number of students enrolled, refund policy, legal documents recognising Byju’s as a valid edtech company, and other documents.
TWEET OF THE DAY
IT ministry pushes deadline for public feedback on data bill to Jan 2
The ministry of electronics and information technology (MeitY) on Saturday extended the last date for public consultation on the draft Digital Personal Data Protection Bill (DPDPB), 2022, to January 2, 2023.
Why? The ministry said it was extending the timeline “in response to the requests received from several stakeholders”. The draft was first published on November 18. Feedback from the public was initially sought by December 17.
Long journey: A data protection legislation for the country was first envisioned 11 years ago, and the process of formulating a draft was first started five years ago.
As per the DPDPB, any entity collecting data from users must obtain explicit consent for processing data. Such entities must also give users the option to opt-out of such processing of data and erase the stored data when consent is withdrawn.
Entities dealing with data can store their data in any jurisdiction that the government declares trusted. The list will be shared by the government from time to time.
Page Industries flags threat from D2C innerwear brands
Page Industries, India’s biggest innerwear firm, said direct-to-consumer companies could be a serious competition compared with traditional and established rivals, as consumers, especially younger generations, are increasingly shifting to smaller and more agile brands.
“We feel D2C can be more serious competition than the traditional competence because of the aspiration of that age group, social media, the kind of connection which resonates with their thinking as well as the agility,” said VS Ganesh, managing director at Page Industries, which runs Jockey and Speedo stores in India.
Zoom out: The Indian innerwear market, worth $6.3 billion, is estimated to account for 9% of the total domestic fashion retail segment but is highly fragmented and unorganised.
Once considered merely essential wear, the segment has grown on the back of work-from-home and hybrid work culture along with increasing awareness on health, fit, and personal hygiene amid the pandemic.
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