Breaking: Google restructures its government affairs & public policy team in India 

One quick thing: Hyderabad-based NBFC IKF Finance nears $70-80 million funding deal 

In today’s newsletter:

• Can quick commerce keep delivering?
• Govt seeks more GPUs under IndiaAI mission
• Cerebras evaluates data centre location in India

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Quick commerce is expanding at a scorching pace. But can Blinkit, Zepto, and Swiggy Instamart keep up the momentum while scaling past top consumer markets? 

While the quick commerce market continues to grow 75-100% yearly, companies may face hurdles scaling past high-density, affluent markets, according to Blume Ventures’ Indus Valley report.

• Low total addressable market (TAM), narrowing monthly transacting users (MTUs), and increased competition from e-commerce players may stall growth, the report said

Industry watchers caution that quick commerce growth in the medium to long term may fall behind projections, similar to sectors like food delivery and mobility.

• Swiggy and Zomato have been facing a slowdown in their core food delivery businesses and have been reporting slower growth over the past few quarters

In fact, user growth forecasts in the consumer internet space have consistently fallen short. 

• July 2021 estimates by Jefferies projected 32.6 million users for Zomato by FY25, significantly higher than the current 20.6 million users, showed the Blume report

Quick commerce firms have recently been on an expansion spree, setting up more and more dark stores to gain market share.

• Analysts expect the cumulative number of dark stores to go from 3,400 in FY25 to 11,150 in FY31

However, the Blume report deemed this target “a tad unrealistic” as only 965 of India’s 19,300 pin codes are affluent enough to sustain dark stores.

Dig deeper

India’s AI cloud push just got an upgrade.

The Ministry of Electronics and Information Technology has launched a continuous empanelment process for AI cloud service providers, allowing firms to apply at any time under the IndiaAI Mission.  

• This builds on the January procurement of nearly 19,000 AI compute units

Unlike the previous tender, new vendors can join anytime, provided they match or undercut the lowest rates (L1) from the earlier round.

The empanelment is open to data centres, cloud providers, managed service providers, and system integrators.

• At least 70% of GPUs must support FP64 (double precision) capabilities

• Applicants will be evaluated on technical qualifications, financial strength, installed GPU capacity and so on

Every quarter, empaneled firms must submit fresh bids, which can match or lower existing rates. 

The first deadline for applications is April 30, 2025, with evaluations starting in May. 

• The IndiaAI Mission will subsidise GPU access by up to 40% through a coupon-based model

• Existing L1 bidders include Jio Platforms, Yotta, Tata Communications, among others  

Dig deeper

For AI chipmaker Cerebras, India is a market it cannot afford to overlook. 

Known for its wafer-scale AI processors and a direct competitor to Nvidia, the company sees India as a crucial hub, thanks to its top-tier universities and highly skilled workforce.  

"India should be creating AI, and they should be running it on Cerebras equipment. So we intend to increase our investment over time in India. We have an office in Bengaluru, some people in Hyderabad, and we expect to grow," CEO Andrew Feldman told us in an interview. 

Cerebras is making strategic investments in both talent and infrastructure.

"We just took a much larger new office, and we're looking to tie up with our partner G42 to establish a data center for Cerebras computing," Feldman said.

Feldman’s comments come at a time when major corporations and tech giants are ramping up their investments in Indian data centres. 

• Reliance Industries Chairman Mukesh Ambani recently announced that Jio is building the world's best AI infrastructure in India

Meanwhile, Japanese technology conglomerate SoftBank is also evaluating potential investments in the country's data center space. 

Addressing concerns over US export restrictions on AI chips, Feldman said that Cerebras remains unaffected, as it does not conduct business with Chinese companies.  

Find out more

AI is rewriting the rules of IT deals. HCLTech CEO C Vijayakumar in an interview with us reveals how AI is slashing completion times and driving shorter tenure smaller deals.

• Overall, he believes that the worst is over for the IT sector slowdown, and expects a gradual long-term recovery going forward

Go deeper

• US-based online education company Chegg has sued Google, alleging it is diminishing demand for original content and hindering publishers' competition through AI-generated overviews that repurpose their work.
  
  
• Anthropic has launched its most advanced AI, Claude 3.7 Sonnet, a hybrid reasoning model that delivers faster, more thoughtful responses with user-controlled thinking time.

Ever wonder if your toaster might just be plotting world domination? 

• Chris Stokel-Walker's How AI Ate the World is your guidebook to understanding the silicon revolution 

More than just a tech history lesson, it's a ride through AI's journey, from Cold War whispers to the chatty rise of ChatGPT. 

Check it out on Amazon

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