Ecommerce in slow lane; PhonePe-BharatPe truce

Happy Monday! Online sales haven’t picked up during the final quarter of FY24, industry officials said. This and more in today’s ETtech Morning Dispatch.

Also in the letter:
■ Sauce VC’s Rs 250-crore fund
■ Adda247’s FY24 financials
■ Indian mythology takes over gaming

Ecommerce fails to click for firms in Q4 as sales dip across segments

ecommerce_sales growth fall_dip_THUMB IMAGE_ETTECH

Ecommerce sales showed signs of a slowdown during the last quarter of FY24, listed firms and industry executives said.

  • Logistics firm Delhivery said ecommerce delivery volumes declined 13% sequentially in the March quarter to 176 million, while on a year-on-year basis they were down 2%.
  • Beauty retailer Nykaa flagged consumer brands diverting their advertising dollars to increase discounts, aiming to drive subdued demand.
  • Mamaearth saw its flagship brand grow in single digits during fiscal 2024

slow lane

State of play:
Given the lack of major events on the back of a robust festival season in the quarter ended December, categories like apparel and smartphones – the biggest contributors to ecommerce sales – recorded muted growth.

  • Overall ecommerce sales were likely growing at less than 15% compared with the usual growth of around 20%.

Tell me more: For smartphones, premiumisation continued as the market grew 18% in terms of value. A venture investor focused on consumer brands said there are macro signs emerging that point at a pickup in demand in tier-II tier-III cities, with early signs like growing two-wheeler dispatches and FMCG sales.

PhonePe, BharatPe settle legal dispute over ‘Pe’


Walmart-backed digital payments firm PhonePe and New Delhi-based fintech startup BharatPe have amicably settled a five-year-long legal dispute on the use of the trademark with the suffix ‘Pe’, the companies said Sunday.

Burying the hatchet:
Both companies have withdrawn all trademark opposition against each other, facilitating the registration of their respective marks, they said in a joint statement.

Case details:
The issue began in 2018 when PhonePe sent a legal notice to BharatPe, asking it to stop using ‘Pe’ in Devanagari script in their brand name.

phonepe bpe

  • In 2019, PhonePe moved the Delhi High Court, seeking an injunction against BharatPe’s use of the ‘Pe’ suffix.
  • In 2021, PhonePe had also moved the Bombay High Court against BharatPe’s holding company Resilient Innovations for using the suffix for its buy now pay later (BNPL) offering PostPe. This copyright infringement plea was dismissed by the court.

Verbatim: “I appreciate the maturity and professionalism shown by the management of both sides, working closely to resolve all outstanding legal issues,” BharatPe chairman Rajnish Kumar said.

Welcoming the development, PhonePe founder and CEO Sameer Nigam said the outcome would be mutually beneficial to both firms.

Consumer-focused investor Sauce VC launches third fund; eyes Rs 250-crore raise

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(L-R) Manu Chandra and Yash Dholakia, partners, Sauce VC

Consumer-focused investor Sauce VC has launched its third fund, aiming to raise Rs 250 crore, founder and managing partner Manu Chandra told ET. The fund has invested in companies like luggage brand Mokobara, healthy foods startup The Whole Truth and petcare firm Supertails.

Fund details:

  • It aims to back 15-16 consumer brands in their early stages.
  • Through Fund-III, it will look at writing cheques in the Rs 3.5-4 crore range, higher than its previous funds
  • It is looking to predominantly raise capital from domestic limited partners, or sponsors that back venture firms
  • It will also raise capital from existing backers, including family offices and corporate houses


Investment strategy: Sauce VC will continue to remain specialised on the consumer space while keeping its corpus relatively smaller compared to other venture firms.

“When we started out in 2019, there was no quick commerce. Now all the last mile infrastructure, tech stack, payments stack, everything has been solved for consumer brands, and brands are becoming bigger much sooner,” Chandra told ET.

Big picture: The new fund comes at a time when the direct-to-consumer (D2C) space is seeing growing interest from risk capital investors, including tech-focused firms. ET reported on May 22 that D2C firms are opening offline stores immediately after raising their first round of funding.

Also read | D2C space: Investments in “not my parents’ brands” are #trending

Other Top Stories By Our Reporters


Adda247 founder and chief executive Anil Nagar

Edtech startup Adda247’s FY24 revenue zooms 88%: Google-backed edtech startup Adda247 recorded revenue of Rs 243.39 crore in FY24, an 88% year-on-year increase from Rs 129.65 crore in FY23. It has also reduced net loss by 66% to Rs 101 crore, down from Rs 296 crore in FY23.

Talent-hunting tech rivals circle around vexed LTIMindtree: The senior talent pool of LTIMindtree has become a hunting ground for other IT companies one and a half years after the merger that created the country’s sixth largest software services company. LTIMindtree was born out of the merger between L&T Infotech and Mindtree in November 2022.

Sacred Games: How Indian mythology is taking over gaming consoles: Gaming developers are now coming up with games rooted in Indian history and culture. Steeped in nostalgia and full of folklore, these games provide users with a chance to experience the epics firsthand.

Incluzza helped Google understand needs of persons with disabilities for Gameface: Project Gameface, an open source, hands-free, on-device, AI-powered ‘mouse’ developed by Google, was designed through feedback from Incluzza, a social enterprise in Bengaluru that supports people with disabilities. Gameface allows users to control a cursor on a phone, computer or tablet with head movements and facial expressions via a webcam.

How companies are using artificial intelligence for hiring: Companies across sectors are using artificial intelligence tools, including generative AI, for candidate sourcing, resume screening, skills assessment, predictive analytics and bias reduction in their recruitment process.

Global Picks We Are Reading

■ SoftBank targets $9 billion a year in AI investments while hunting bigger deals (FT)

■ AI is an energy hog. This is what it means for climate change. (MIT Technology Review)

■ Apple bets that its giant user base will help it win in AI (Bloomberg)


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