Amazon’s dirty business 😖
Mass quittings, Putin’s love, and ClassPass sold.
Market summary: 📊
Next stop, 20K on Nifty? Indian investors went into a long weekend on a high note, adding another solid % to gains. US had a solid Thursday too, with tech stocks favored for a change.
US:
S&P 500 - up 1.71%
Nasdaq - up 1.88%
India:
Nifty 50 - up 0.97%
Sensex - up 0.94%
What’s brewing hot ☕
✅ Nykaa has been okayed — SEBI greenlit Nykaa’s IPO, paving the way for the omnichannel cosmetic king to raise ₹4,000 crores from the markets, at a ₹40,000+ crore valuation. To remind ya, Nykaa makes about ₹2,400 crore in revenues, with ₹60 crores in profits, operating a robust online D2C operation combined with offline stores in 70+ locations. The cosmetics game in India has completely changed post-COVID — with digitization tilting the scale in favor of local brands, who offer better price points, more customization, and wider tastes. Besides, Nykaa has aggressively diversified into more merch. Killer bid!
✅ Car party spoiled — India’s car sales for September have tanked more than 30%, thanks to the stubborn semiconductor and electronic component shortage. What’s worse is that consumer demand remains solid, and automakers were supposed to make the most of this holiday season to recover for all of 2020’s blood loss. 2 and 3 wheeler sales are mostly unaffected though, growing at a healthy clip. Outside of Tata Motors riding the EV wave, all other auto stocks have been mostly duds.
Amazon’s business in India raises questions 🤔
What happened — Amazon was caught with its pants down after Reuters found that the company’s India entity led a systematic campaign to create competitive knock-offs of popular products on its platform, and also manipulated India search results on Amazon to favor its own products.
Honestly, both are somewhat common practices worldwide — in the offline world, large retail brands like Walmart or even your neighborhood supermarkets engage in making knock-offs of popular products, priced lower, very routinely, and in fact make most of their profits this way.
Sometimes these products are placed more favorably, while branded products are placed in tough to reach isles. Fair game.
But… considering India’s digital-ecosystem is just coming up, pitting a cash-rich mammoth like Amazon, with all the expertise in the world, against smaller, upcoming, digitally un-savvy and restricted solo merchants of India — that’s a completely unfair equation.
What next — Indian regulators’ file against Amazon is running long. Recently Amazon was also accused of bribing Indian officials via lawyers. GOI could compile everything and swing one heavy punch.
And considering how “invested” Amazon is in India, talent, and capital wise, we’d bet the leverage regulators have is substantially higher.
Nobody wants to work anymore 👊
America is facing one of its weirdest challenges — mass quittings. 4.3 million people quit their jobs last month, or almost 3% of the total adult workforce.
700K of those worked professional jobs. Rest were restaurant workers, folks in retail, hotels etc. The numbers are truly surprising!
Rising retail inflation coupled with poor growth in paychecks has made the value of a secure income low for some folks. Meanwhile, alternatives via creator economy, gigs on Uber, Instacart, and other platforms, stimulus checks, as well as burnout during COVID are several of the reasons people can point to.
Quick look at a global workout-tech acquisition 👀
Subscription fitness platform, ClassPass, which pioneered the model of buying a single Netflix-like subscription to multiple workout studios, got acquired by MindBody in a $1.5B+ deal.
Mindbody sells a SaaS platform to fitness studios, workout facilities, and spas around the world. ClassPass could be a direct integration into their services — allowing gyms to issue more flexible subscription plans to individual clients, as well as expand into a growing category of studios run by single trainers.
FYI, the company founded by Indo-American Payal Kadakia had been through multiple near death moments before it took off. Good story!
Closing out — Crypto's newest friend? Putin 🧑🤝🧑
My enemy’s enemy is my friend… After China banned crypto, and now the US is considering tightening rules via an executive order, Russia sees opportunity.
Putin told Bloomberg he thinks crypto as a payment mechanism should exist, and can be used as a means of payment too. Nobody had expected that. Russia has incentive to push for a disruption in global banking and finance though — considering they’re facing sanctions that ban them from trading in US Dollars for certain goods.
Regardless of the motivation, crypto-bros cheered the vote of confidence.
Otherwise an easy news day folks, with most businesses taking it easy for the long weekend. BTW, we’re out tomorrow for Dussehra so there won’t be a newsletter coming up on Saturday. Wishing you guys a Happy Dussehra! Take it easy 🤙
What else are we snackin’ 🍿
🤷♀️ We outta coal — Coal India has put a temporary halt on supply of coal to non-power users, to make sure power plants get enough supply.
🤙 New gig — one of the co-founders of Pinterest, Evan Sharp, is stepping down and joining Jony Ive’s design firm, LoveFrom. Jony was the guy that pioneered Apple’s design during the Steve Jobs era, and quit Apple in 2018.
Hit that 💚 if you liked today’s issue.
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Google, than Amazon, than WPP than...................
Indian advertising, watch out! The auditors have arrived! SEC vs WPP.