Also in the letter:
■ AI banking assistants
■ Partners Group goes shopping
■ Sebi curbs sting stockbrokers
ONDC mulls subsidy comeback amid slowdown in food delivery
The Open Network for Digital Commerce (ONDC) is planning a fresh subsidy push to woo food delivery customers, just months after pulling the plug on earlier incentives. The government-backed network is looking to earmark Rs 100-150 crore for the initiative, sources told us.
Discount push: If cleared, the subsidy will allow platforms such as Magicpin, Paytm, Ola Consumer, and Waayu to offer deeper discounts to users. The incentives are likely to be rolled out in phases, according to those familiar with the matter.
Restaurants eye new routes: India’s food delivery market is still dominated by Zomato (owned by Eternal) and Swiggy. High commissions have forced many restaurants to explore cheaper alternatives.
Logistics remain a hurdle: Analysts reckon that despite the subsidy rethink, ONDC’s most significant challenge remains last-mile delivery. Karan Taurani, executive vice president at Elara Capital, said that discounts might spike order volumes in the short run, but won’t drive long-term growth unless core operational gaps are fixed.
Also Read: Uber to offer logistics services through ONDC network
TCS clocks profit in Q1 despite deal slowdown
Tata Consultancy Services (TCS) reported a modest profit rise in the June quarter, even as global demand faltered. Executives blamed geopolitical tensions, economic uncertainty and supply chain disruptions for the sluggish top line.
Q1 performance:
- Revenue: Up 1.3% year-on-year (YoY) to Rs 63,437 crore, but down 3.1% in constant currency.
- Net profit: Rose 6% to Rs 12,760 crore.
- Deal wins: Total contract value stood at $9.4 billion.
- Operating margin: At 24.5%, up 30 basis points (bps) quarter-on-quarter, but down 20 bps YoY.
- Attrition: Rose slightly to 13.8%, from 13.3% in the previous quarter.
Tariff troubles: TCS is feeling the heat in the US, its biggest market, where tariffs are hindering IT spending. With artificial intelligence looming as a disruptor, recovery remains elusive. North America revenue fell 2.7%, dragged by delayed decision-making.
Also Read: Dollar’s slide may help IT add 70–300 basis points to Q1 revenues
Deal? No deal: Other regions didn’t fare much better. Europe declined 3.1%, while India saw a 21.7% revenue slump, following the completion of a large BSNL project.
CEO speak: “It could be too early to call out when growth will resume,” said CEO K Krithivasan, adding that he expects better traction in international markets later this fiscal.
“Mega deals are always lumpy… we did not have any in FY25. It’s very difficult to provide an outlook on these large deals, but we are working on a couple of them,” he added.
Also Read: TCS paid CEO K Krithivasan Rs 26.5 crore in FY25
Tata Elxsi Q1 profit drops as sales take a hit
Tata Elxsi, another Tata Group company, reported a significant drop in first-quarter profit as revenue declined during the period due to macroeconomic pressures.
Q1 performance:
- Revenue: Fell 3.7% year-on-year (YoY) to Rs 892 crore.
- Ebitda: Dropped 26% to Rs 187 crore.
- Net profit: Declined 22% YoY to Rs 144 crore.
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How may (A)I help you? Lenders, NBFCs tap agentic AI to serve customers
Banking and non-banking financial firms (NBFCs) are leveraging agentic AI, particularly voice-driven tools, to sharpen their customer service capabilities, from onboarding to query resolution.
Driving the news:
- Startups like Hyperface, Gnani.ai, and Yellow.ai are building next-gen voice AI agents that don’t just respond, but emulate human tones to make conversations feel natural.
- These tools go beyond traditional IVR and machine learning-based bots, enabling banks to reduce operational costs by up to 50%.
- Early use cases include handling queries around credit cards and basic account services.
Scaling quickly: Bajaj Finance, one of India’s largest lenders, is doubling down on tech. It recently picked up a stake in Protectt.ai, a mobile security startup. Similarly, Aurinpro has acquired Arya.ai to strengthen its AI offerings for banking clients.
Challenges persist: India has approximately 44 GenAI startups focused on voice and speech. However, regulatory clarity is lagging. Experts say that the rules governing the use of AI in sensitive areas, such as debt collection, remain unclear, delaying rollouts and raising concerns about consumer protection.
Keeping Count
Veo 3 on Gemini, Google’s latest AI video model capable of generating realistic, high-quality videos from text or image prompts, was first launched at Google I/O in April and arrived in India just a week ago. The internet giant has now added a photo-to-video feature to further expand its creative capabilities. (Source: Google)
Other Top Stories By Our Reporters
Shrikant Ravalkar, founder, Infinity Fincorp Solutions
Partners Group acquires Infinity stake: Swiss investment giant Partners Group is set to acquire a majority stake in Mumbai-based non-bank lender Infinity Fincorp Solutions for Rs 1,950 crore (approximately $230 million).
F&O reins cost stockbrokers users: The total active user base of major Indian stockbroking platforms fell to 29.5 million in June from 30.5 million in February as market regulator Sebi curbed futures and options (F&O) trades and market volatility.
Vertical AI opportunity for Indian startups: A recent report by AI startup accelerator Upekkha highlighted that a price advantage and 20 years of IT services expertise position Indian startups favourably to tap into the vertical AI opportunity.
Global Picks We Are Reading
■ Meta is trying to win the AI race with money — but not everyone can be bought (The Verge)
■ Cloning came to polo. Then things got truly uncivilised (Wired)
■ Politics and USAID cuts put a telehealth program on life support (Rest of World)
