Also in the letter:
■ IT’s tariff troubles
■ Reforms for India flip-back
■ NBFC Finodaya raises funds
Tesla in talks to source semiconductor chips from India
Electric vehicle giant Tesla is in talks with US chipmaker Micron and Indian firm CG Semi to source semiconductor components. This follows a strategic deal with Tata Electronics to procure chips for its global operations.
Details: Sources told us Tesla held discussions with representatives from the three companies—each with a growing presence in India—in March. One person in the know said the conversations concerned Tesla’s chip requirements, packaging expectations, operational plans, and timelines.
Tell me more:
- Micron’s Gujarat facility will support assembly and testing for domestic and global clients.
- CG Semi, part of the Murugappa Group, is setting up a Rs 7,600-crore outsourced semiconductor assembly and test (OSAT) facility.
- Tata Electronics, TCS, and Tata Technologies are already supplying Tesla and aim to deepen this partnership as Tesla expands into India.
Big picture: China imposing 80% import tariffs in response to US levies is disrupting global semiconductor supply chains. Automakers like Tesla must diversify sourcing, and experts see India as a key beneficiary of this realignment.
Tesla’s woes: Tesla’s push into India comes as it grapples with global headwinds. Its stock is down 30% this year amid criticism of Elon Musk’s distracted leadership. His alignment with Donald Trump’s anti-spending stance and continued embrace of far-right politics have triggered global protests, further impacting sales and employee morale.
BluSmart bond holders may invoke immediate repayment provisions
Anomol Singh Jaggi, cofounder, Blusmart
BluSmart Mobility, which raised approximately Rs 100 crore through non-convertible debentures (NCDs) from high-net-worth individuals and retail investors, may soon face an ‘Event of Default’ demand from bondholders.
Driving the news: Investors who purchased BluSmart Mobility bonds are concerned that their repayments may be delayed or halted following the shutdown of the company’s flagship ride-hailing platform, BluSmart. In response, they are now demanding immediate repayment of both principal and interest.
Understanding the context: Several new-age platforms that distribute corporate bonds and unlisted shares—such as Yubi—continued to market these high-yield papers as recently as February 2025. Investors are now questioning why these platforms promoted the bonds even as BluSmart’s associate entity, Gensol, was reportedly under Sebi investigation.
Way forward: While BluSmart has made all repayments, investors are anxiously awaiting the next instalment due at the end of this month. If payments stop, legal action may be the only recourse. For now, bondholders hope for an acquisition or that rival platforms absorb BluSmart’s fleet, allowing operations to resume and debt serviced through new cash flows.
Read ETtech’s in-depth covering of the Gensol-BluSmart crisis:
US tariff clouds loom large over Indian IT’s key revenue streams
Ongoing uncertainty around global tariffs may dampen sentiment and put pressure on key sectors such as consumer, retail, and manufacturing — all crucial to India’s software services exports industry.
Numbers game: For India’s top six IT companies—TCS, Infosys, HCLTech, Wipro, Cognizant and Tech Mahindra—the affected sectoral exposure accounts for 28% of FY24 revenue. According to data, that’s roughly $27 billion out of the $97 billion business.
- For TCS, manufacturing and consumer segments contribute nearly 24% of revenue.
- Infosys derives over 29% of its revenue from manufacturing and retail.
- Wipro’s consumer business alone contributes over 19%, with manufacturing not reported separately.
Sour outlook: With continuing uncertainty around shifting tariffs—particularly in China, a major global manufacturing hub—supply chains remain disrupted. Companies in key markets such as the US and Europe, critical to Indian outsourcing firms, have grown cautious in their decision-making.
- The caution is already visible. In the past two weeks, three of India’s largest IT services firms—TCS, Infosys, and Wipro—reported mid-to-flat revenue growth for the March quarter.
- Senior management of all three companies cited tariff-related uncertainty as a key factor dampening client sentiment.
Other Top Stories By Our Reporters
Iron out ‘reverse flipping’ kinks: Startups tell govt: As the government simplifies the process of ‘reverse flipping’ – which enables startups domiciled overseas to relocate to India –companies exploring such a move are calling for further reforms to eliminate procedural hurdles, people familiar with the matter told ET.
Finodaya Capital raises $2.5 million: Indore-based non-banking financial company (NBFC) Finodaya Capital has raised $2.5 million in seed funding, led by venture capital fund White Venture Capital, at a post-money valuation of Rs 50 crore.
Smarter, but less accurate? ChatGPT’s hallucination conundrum: While artificial intelligence continues to deliver groundbreaking tools that simplify various aspects of daily life, the issue of hallucination remains a persistent and growing concern.
Zomato and Blinkit parent Eternal’s board clears plan to cap foreign ownership at 49.5%: The move aims to provide “greater operational flexibility” to its quick commerce arm, Blinkit, by allowing it to hold inventory, rather than operate solely as a marketplace, as mandated under India’s foreign investment rules.
Global Picks We Are Reading
■ A Google Gemini model now has a “dial” to adjust how much it reasons (MIT Technology Review)
■ Stumbling and overheating, most humanoid robots fail to finish half marathon in Beijing (Wired)
■ Famed AI researcher launches controversial startup to replace all human workers (TechCrunch)
