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In today’s newsletter:

• China to get a slice of India's electronic components PLI
• Ultrahuman funding: SoftBank out, WestBridge in
• Deloitte flags lapses in Dailyhunt parent VerSe's accounts

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India is recalibrating its strategy on Chinese investments in electronics.

The government is considering allowing Chinese companies to own up to 26% equity in joint ventures for specific critical electronics components, officials told us.

• For most other categories, however, the tighter 10% cap will be applicable

 Officials told us that no blanket approvals will be given — all proposals will be scrutinised case-by-case.

During meetings with domestic electronics manufacturers last week, the government said it wants technology transfer as a condition of allowing Chinese stakes.

• Chinese players are increasingly willing to accept India’s conditions, seeking new growth markets as the US-China tariff war bites, officials said

• Chinese supplier Lianchuang Electronics, a key partner for Oppo, Vivo, and Samsung, is in talks with Amber and Optiemus to enter India’s display, camera module, and IC manufacturing space

Key Indian players, including Dixon, Tata Electronics, Kaynes, Micromax, and Amber, are preparing investment plans under the newly launched Rs 22,919-crore Electronics Components Manufacturing Scheme (ECMS).

Union Minister Ashwini Vaishnaw, while announcing the guidelines and the launch of the ECMS portal, said that any foreign direct investment (FDI) will be approved in accordance with the FDI Policy Circular 2020, without commenting on investments from any specific country.

• The government, he said, will consider only those companies for the scheme that have established design houses and maintain “Six Sigma” processes

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Picture credit: Dall-E

Sometimes, things happen for the best. 

Ultrahuman is now in talks to raise over $120 million from WestBridge Capital, sources told us. 

• The company is being valued at $550–600 million, a significant jump from its $125 million valuation in March 2024
  
  
• Other private equity players may also join and upsize the round 

A larger round comes after Ultrahuman was in advanced talks to raise a smaller $40 million round from SoftBank.

• However, the two sides couldn’t find common ground on the company's future potential, we were told

A bigger funding round will help Ultrahuman expand more rapidly into other regions and take on rivals.

• One of its key backers, Eternal (formerly Zomato) founder Deepinder Goyal, has also started a longevity company

Ultrahuman is raising a larger round at a much higher valuation at a time when investors are becoming more cautious.

• Its revenue has jumped from $74 million in 2024 to $150 million in 2025

For WestBridge, this will be yet another major bet after backing PhysicsWallah and Rapido in earlier rounds.

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Trouble is brewing at VerSe Innovation, as its auditor, Deloitte, has flagged serious allegations of lapses in the company’s financial controls.

Deloitte has raised concerns across multiple areas of VerSe’s operations, which could lead to misstatements:

• VerSe lacks proper controls over supplier selection, approval of purchase orders, and payments
  
  
• Weak oversight on customer acceptance, pricing, and user access
  
  
• Gaps in ensuring that advertising campaigns were properly documented with customer-approved release orders

This comes amid growing corporate governance issues in India’s startup ecosystem.

• Gensol Engineering is under scrutiny for financial mismanagement and transparency issues, with questions raised over its internal controls
  
  
• Medikabazaar recently removed its CEO over allegations of financial misreporting and misappropriation
  
  
• Auditors have raised alarms over potential fraud at Bizongo, further highlighting concerns about governance practices in the sector

Verse has responded with steps to improve its internal controls, but will it be enough?

• The company is working on tighter controls for supplier management and virtual assets, including a new end-to-end framework

Verse saw a reduction in its net loss for FY24, reporting Rs 889 crore, down from Rs 1,909 crore the previous year.

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Picture credit: Google AI Studio

New challenges, new strategies!

In an interview with us, LTIMindtree’s CEO Debashis Chatterjee and incoming CEO Venugopal Lambu discuss how they are navigating pressures on large transformation programs as clients tighten budgets.

• However, the IT services major has not seen any cancellations in existing projects, despite uncertainties in the business environment, including concerns over Trump’s tariffs

The top leadership also share insights on their recovery plan, their new AI business unit,and growth strategies at a time of evolving deal structures.

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• Huawei is preparing to test its Ascend 910D AI processor, due for delivery by the end of May, to compete with Nvidia's leading AI chips.
  
  
• As Meta pushes to make AI-driven chatbots the next big thing on its social media platforms, employees have raised alarms about ethical concerns, especially regarding the exposure of children to sexually explicit content.

Assam is all set to roll out the red carpet for influencers for its upcoming media city, making it a creators' hub. 

• The state wants influencers on sets to create their Reels and use technology from green screens to AI for scripting, editing and more

Bodhitree, the company behind the upcoming film city in Guwahati, is betting big on the growth of new media, which accounts for over 40% of India's media and entertainment industry revenues. 

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