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8/ The era of treating coaching as a leveraged property bet is over. The lesson for 2026 is clear: if your debt exceeds your operating reality, you no longer own your business - your creditors do. #Resonance #KotaCoaching #BASEEdu #DebtCrisis #TestPrep #EducationIndia #KotaCrisis

7/ As the market narrows to a few scaled players like Allen and PhysicsWallah, the Resonance story highlights a shift in focus: from "blitzscaling" through debt to the sustainability of offline economics and faculty retention.

6/ The Resonance-BASE case shows the collateral damage of group-level enforcement. Blanket account freezes might give lenders leverage, but they destroy faculty trust and student continuity - the very assets required for a recovery.

5/ Covid and regulatory crackdowns on "dummy schools" and coaching age limits have accelerated the reckoning. The high-pressure, campus-centric model has lost both volume and legitimacy, while leaner, hybrid players have captured the new market.

4/ The shift has been brutal. Enrolments have collapsed from a peak of 80,000 to just around 1,000 at the Kota centre. What was once a global brand is now struggling with a 98 percent erosion of scale in its core offline business.

3/ The fatal mistake? A significant portion of the borrowed capital was deployed into real estate - campuses and hostels. For a reputation-driven service business, this was a massive mismatch. Real estate is illiquid and slow-yielding, trapping capital when demand shifts.

2/ The crisis recently hit a breaking point for BASE, its South-India subsidiary. Despite being profitable in FY24 with 11.5 crore rupees in profit, BASE saw its accounts frozen. Cash exists, but access to it doesn't. This is the reality of creditor-controlled operations.

1/ Resonance was once the defining name in India’s offline test-prep industry. Today, it symbolises how a debt overhang can quietly hollow out a business. With group-level revenue at 160 crore rupees against 800 crore rupees in debt, the math has simply stopped working.

8/ Budget 2026 chooses certainty over experimentation. It is a rational, builder’s move for the services sector, but it leaves the product ecosystem asking: when will innovation get its own safe harbour?
#Budget2026 #ITSectorIndia #GCC #TransferPricing #SafeHarbour #SaaS

7/ Globally, Ireland and Singapore tie incentives to R&D spend. India ties them to revenue scale. While this secures massive employment and fiscal safety, it risks crowding out the patience required to build foundational, breakthrough Indian IP.

6/ There is a talent effect, too. GCCs already offer global pay; now they offer tax and operational stability. For a top-tier engineer, the choice between a risky Series-B startup and a Multinational Centre with total tax peace becomes even more skewed.

5/ Combined with the 20-year tax holiday for foreign data-centre operators (up to 2047), the budget is positioning India as the world's most predictable base for cloud infrastructure. We are doubling down on the "Back Office 2.0" thesis.

4/ The margin is now uniform: a commodity BPO and an R&D-heavy AI lab are taxed at the same 15.5%. The signal is subtle but powerful: execution is safer than invention. This could trigger a wave of tax-driven M&A as smaller firms seek shelter under larger parents.

3/ But there is a hidden schism. A mid-market SaaS or AI startup with revenue below ₹2,000 crore remains exposed to complex litigation and valuation disputes. The policy effectively rewards operational volume while leaving "innovation-heavy" smaller firms to navigate the old paperwork.

2/ For the "Top Tier”, multinational GCCs and legacy IT giants, this is a liberation. Automated, rule-driven approvals replace discretionary scrutiny, allowing CFOs to plan long-term tax roadmaps. India is now competing directly with Singapore and Ireland for captive centres.

1/ Union Budget 2026 just redrew the tax map for Indian tech. By lifting the safe harbour threshold to ₹2,000 crore and fixing a common 15.5% margin, the government has replaced transfer-pricing anxiety with multi-year certainty for large IT firms and GCCs.

8/ This is not the end of Indian IT, but it is the end of its traditional fortress. The next phase of leadership belongs to those who adapt to selling outcomes instead of hours. The question is: will India own the tools of change, or merely rent them? #Anthropic #ClaudeCowork #AIAutomation

7/ To survive, India must pivot to "Vertical AI." While US players own the generic agents, India can own the intelligence for GST, Indian tax law, and vernacular support. Complexity is the new moat; localization is the new leverage.

6/ However, this shockwave is a forcing function. The same tools threatening services are enabling a new class of "billion-dollar, ten-person startups." Indian founders are already moving toward "vibe-coding" to reach massive scale with tiny teams.

5/ The "India Execution Discount" is now visible. While US tech firms are valued as owners of AI intelligence, Indian IT firms are viewed as users. When execution is automated, the "execution arm" of the global economy faces a structural repricing.

4/ The market reaction was swift: Infosys and Mphasis fell over 7%, while TCS and HCLTech dropped 5-6%. Investors are no longer worried about quarterly earnings; they are worried about the future relevance of headcount-based revenue models.

3/ This isn't just a platform shift like the move to Cloud. It is workforce substitution. When a single AI agent can review 100 contracts or triage NDAs faster than a 50-person offshore team, the "billable hour" model begins to hollow out.

2/ For two decades, Indian IT thrived on labor arbitrage - selling human execution at scale. Anthropic’s new "agentic" tools break this logic by handling high-value white-collar workflows like legal review and compliance for $20 a month.

1/ Anthropic just rattled the foundations of the $280B+ Indian IT empire. The launch of Claude Cowork and its legal automation tools on February 3 triggered a brutal sell-off, wiping out ₹1.9 lakh crore in value from the Nifty IT index in a single day.

8/ Indian venture capital is not breaking; it is growing up. The unbundling of power is a sign that scale is no longer the only advantage. The future belongs to those who can provide precision funding and long-term partnership in a volatile market. #PeakXV #VentureCapital #VCNews #FundRaise

7/ Peak XV’s pivot to AI-native investing and its US office launch shows that mega-funds are also evolving. They are becoming specialized infrastructure layers, while departing partners are becoming surgical, founder-first allocators.

6/ We are witnessing the "reverse-flipping" of capital. Indian-domiciled funds, backed by domestic family offices and HNIs, are increasingly leading rounds. The long-term shift ensures that the lead investors of 2028 will be domestic franchises.

5/ This pattern is a sign of market maturity. India has seen this cycle before with the birth of WestBridge and A91. It happens when personal reputation begins to outweigh the institutional logo. Peak XV itself is a product of this exact unbundling process.

4/ Fragmentation does have costs. Micro-funds lack the capital depth to lead massive follow-on rounds, creating potential signaling risks. However, they act as better partners for "hard tech" and AI bets where a 10 crore rupee exit is meaningful.

3/ The new micro-fund thesis offers something rare: growth-stage judgment at the seed stage. These partners have navigated IPOs for companies like Groww and Mamaearth. For early-stage startups, this institutional depth matters more than a global brand.