Ola, India’s biggest cab aggregator, launched an internal investigation against Human Resources Head and Chief Administrative Officer Yugantar Saikia. According to sources, the fraud amounts to millions of dollars and the investigation will include a review of nearly 1000 employees Saikia has hired. The cab aggregator company also hired one of the ‘Big Four’ audit firms to lead the internal probe and help with the investigation.
FactorDaily first reported, Saikia allegedly favored certain vendors and accepted kickbacks from them in return. Sources further claimed, Saikia’s laptop, documents and several other items have been seized for the investigation and he has been asked not to report for work. However, Saikia told FactorDaily he had not been “notified” about any such action by the company.
The report further claims, Saikia received kickbacks from employment agency as well and the fraud must have been going on for at least 2 years. According to one person cited in FactorDaily, “ I estimate annual monies (sic) earned through recruitment alone to be at least Rs. 5-6 crores. And, this is just the fee paid to an outfit created for the purpose.”
Another source added, “An investigation is ongoing, the scope of the fraud goes beyond just recruitment, it includes procurement, administration and IT.” As a part of this cleanup, a review and overhaul of processes are also underway. Ola’s spokesperson confirmed the latest development and said, “There is an internal investigation which is currently on and one cannot give further details at the moment.”
Saikia, who was one of cofounder Bhavish Aggarwal’s key executives at the company, has already quit the firm and his last day was supposed to be the end of March. Saikia joined Ola in February 2015 to head the Human Resources department. Since then, Ola has raised over $2 billion in fresh funding and grown its fleet seventeen times to 700,000 vehicles including auto rickshaws.
Founded in 2011 by Bhavish Aggarwal and Ankit Bhati, Ola currently has a user base of 125 million across 110 cities in India and employees over 6000 people now.
Amazon Becomes The Second Most Valuable US Company
As the stock market closed on Tuesday end of business, a brand new discovery was made. For the first time in history, Amazon surpassed its parent company and became the second most valuable publicly listed US company!
Amazon shares closed at 2.69% at $ 1,581, for a market capitalization of $ 768 billion. With this, the company underscored Wall Street’s confidence in its relentless expansion into cloud computing, groceries and other areas of business.
Amazon’s market price surged by 81% in the last week, as shoppers started preferring online shopping over regular stores. Further, cloud computing also has had a higher preference in the last few weeks. Amazon gained $60 billion in market value in just over a month. In February, it crossed to Microsoft to become the third most valuable company in the world by that measure.
Millennials have a lot going on for them. The one thing they love? The thrill they get from shopping. However, online shopping has become the preferred platform for practically everything. Seattle based Amazon dislodged Microsoft to become the third company on the list of the most valued publicly listed companies.
While these companies all ranked very closely on the market list, Amazon surged forward because of constant innovations and improvisations. Both Apple and Alphabet Inc., the parent company of Google, have gotten very comfortable in their positions and gotten a little lacklustre with their products.
“They’re using their cash flow to develop new businesses,” said Tim Ghriskey, chief investment strategist at Inverness Counsel in New York. “They could have Apple in their sights at some point.” The stock market “gurus” have given price targets for the three companies to stand at a capitalisation of $ 823 billion. On the other hand, Alphabet stands at $ 914 billion and Apple stands at $ 989 billion. If this continues, Amazon can quite easily take over Apple’s market value in a very short time span.
Walmart Flipkart Deal May get Finalised In March
India’s e commerce war is set to get extremely exciting in the coming months. One of the largest retail giants in the United States, Walmart Inc., has been upping its investment game by acquiring a large stake in Flipkart. Walmart is currently in the final leg of striking a deal that will see it spending about $ 7 billion to become the largest investor in India’s leading homegrown e commerce firm, Flipkart, which is currently locked in a fierce battle with Amazon.
According to reports, once the deal goes through, Walmart will own around a third of Flipkart’s shares, making it the majority share holder in parts. This is going to happen after purchasing stakes from existing investors, Tiger Global Management and SoftBank Group Corp. This goes against earlier reservations by Japan’s Softbank which had shown reluctance to let Walmart take the driving seat in the e commerce venture.
The deal, expected to go through at the end of this month, will raise the valuation of Flipkart’s valuation to about $ 20 billion. This increases Flipkart’s valuation drastically as it stood at only $ 12 billion in the past year. The deal is expected to get finalised in the next two weeks which means Walmart is expected to enter the Indian e commerce market by the end of March 2018 or early April 2018.
Apart from being a strong financial investment in the country, this investment by Walmart brings to front the constant rivalry between Amazon and Walmart. Looking at this massive investment from Walmart, existing investor SoftBank is looking at pulling out from its commitments to Flipkart. Once this round of investment goes through, Flipkart ends up becoming one of the largest e commerce platforms not only in India, but across the world as well.
The deal could be a major payday for all the existing investors. Flipkart’s first institutional backer, Accel India had invested $ 1 million at a valuation less than $ 5 million in 2009. The firm has already cashed in about $ 150 to $ 200 million and will see the value of its 5-6% stake swell to about $ 1 billion.
SoftBank Invests In Grocery Startup Grofers
Online grocery store, Grofers, raised $ 62.5 million in a round of funding led by SoftBank. As a result of this investment, SoftBank now owns around 35 % to 40 % of the Gurgaon based startup. According to several industry reports, this investment round also saw participation from existing investors like Tiger Global and Russian tech billionaire, Yuri Milner.
This funding round came barely a month after Grofers released a statement saying they were expecting a funding round of around $ 65 million from its existing investors. Founded in the year 2013 by two tech developers, Grofers recently shut down the operations in several cities around the country. Reportedly, the online grocery company wants to focus only on the Delhi/NCR region.
Just before it shut down operations across the country, Grofers used to deliver in 26 countries, clocking in nearly 15,000 orders on a daily basis, with an average basket size of $ 18.7 to $ 20.8 (about Rs. 1,200 to Rs. 1,350.) This move comes in an effort to strengthen Grofers strong market position. In the last year, its biggest competitor, BigBasket secured around $ 300 million in a Series E funding round led by Alibaba with the participation of Abraaj Capital, Sands Capital and IFC.
Grofers currently offers products across categories like grocery, fruits and vegetables, beauty and wellness, household care, baby care, pet care, bakery and meats and seafood, among other things. The company claims to be profitable with day to day based online deliveries in Delhi. As of March 2017, BigBasket holds about 35% in the food delivery sector while Grofers follows behind as a close second.
Flipkart, on the other hand, is reportedly looking to set up a chain of delivery and retail stores all across the country. This is going to happen in partnership with global retail giant, Walmart. With so many competitors popping up in growing numbers, Grofers faces some serious competition. It is going to be interesting to see how the online delivery platform uses this round of funding from SoftBank.
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