IT feast begins
Gaming shizz, vaccine problems, and $COIN kills it.
Hi 👋, Tanvi here.
Filter Coffee hits your inbox every morning with notable tech and business news scoops to jump start your day.
Sign up below for free. 👇
Let’s go ahead and get started:
Market summary: 📊
Indian markets were closed for Dr. Ambedkar Jayanti. US crawled back a bit, with tech taking a rough beating.
US:
S&P 500 - down 0.41%
Nasdaq 100 - down 1.31%
What’s brewing hot? ☕
✅ Payback time—the ill fated EverGiven that blocked the Suez Canal isn’t done with its problems. Egyptian authorities have now seized the ship and are demanding more than $900 million as compensation from its owners for all the trade disruption it caused. Owners will likely have to pay, because Egypt gets pretty nasty when it comes to the authority around the canal, having even blasted France in a turf war back in the day. Bosses of EverGiven don’t seem too worried and have figured out a way to split the bill with insurers.
✅ New rich boy in town—with Trump gone, TikTok has nowhere to go but straight up and the founder of parent Bytedance, Zhang Yiming, has become one of the wealthiest people alive, sitting on top of a $60 billion pot! Revenues are consistently growing 100%+ and there’s some early chatter of a HongKong IPO in the making as early as mid-year, with valuation as high as even $500 billion.
SPONSORED
Diversification is the name of the game
One of the primary reasons why investing penetration is dismally low in India is that most people don’t have the appetite for the choppiness of the stock markets.
But with global fiscal policies in shambles, and high inflation plaguing emerging markets, popular alternatives like savings accounts and FDs are no longer sufficient.
That’s the problem Wint Wealth is trying to solve. The company’s asset backed high-yield debt products try to deliver 9-11% of fixed returns—offering a middle-ground solution between poor rates offered by vanilla savings accounts and FDs, and the high-returns, high risk nature of the stock market.
The company recently raised $2 million from Zerodha, Better Capital, Kunal Shah, and 20 other big name investors to attack the problem.
If you happen to drop by, tell them Coffee sent you!
INFY confirms the boom 📈
TCS’ earnings yesterday hinted at things getting better in IT land, with demand coming back and profits growing thanks to all the cost cutting amidst the pandemic.
Today, Infosys reaffirms the trend with its own, pretty solid, earnings print:
Quick look at the numbers:
Revenues of $3.16B, were up 13% YoY—that’s better growth than TCS
Operating margins of 24.5%, improved almost 3.4% YoY
Investors seemed pleased with the board’s dividend announced
Infosys management expects revenues to grow 12-14% this year, which is an extremely positive outlook
Stock was actually down 3% once the print rolled out, but given the choppy indecisive market conditions we’re in these couple of months, that’s understandable.
Meanwhile, other IT giants have no excuses to match up to the upbeat picture painted by TCS and INFY, and any faults could be hammered beyond proportions.
Gaming is the shizz 🎮
Epic Games, the developer of the sensational game Fortnite, closed a $1 billion round of capital, led by PlayStation maker Sony, valuing the business at $28.7 billion! Fidelity Management, Baillie Gifford and Appaloosa Management—all typical late stage buyers pitched in.
This is probably one of the largest gaming raises we’ve seen recently, which highlights a significant turn for the industry as it prepares to make the most of emerging trends around social gaming, in-game merch and payments, use of crypto, AR and mixed reality etc.
Sony and Epic had begun cozying up for a while now, with Sony buying 1.4% in Epic for $250 million a year ago, and working closely with EPIC’s engineering team to improve the storage architecture of the PS5 console, using Epic’s futuristic gaming engine, “Unreal Engine 5”.
Also, as Sony scrambles to fend off competition from Microsoft’s Xbox, as well as the cloud gaming sniffers Google, Amazon, Facebook, the engineering-savvy EPIC team could end up being a formidable tech-partner to Sony.
Oh BTW, this is the same Epic that’s currently taking on Apple for its restrictive App Store policies, and Sony’s billion-dollar backing here kinda offers the company unassailable confidence firepower.
Say grace to a fallen soldier 🙏
Flipkart is pretty close to buying out travel booking platform, Cleartrip for a paltry $40 million, looking to save the Cleartrip from going kaput, while diversifying its own offerings into travel commerce.
Pandemic-battered Cleartrip couldn’t be more relieved—founded almost 15 years ago, the business had a ball for a while, raising $55 million+ in venture funding, and at a point processing nearly $1.5 billion worth of bookings annually. The customer service was well buttoned, and the minimalist look was a hit among regulars.
But the OTA space is brutally competitive, essentially a race to the bottom where nickel-and-diming users is the only meaningful way to turn a profit. Consolidation between Indian rivals, like MakeMyTrip and Goibibo made things even harder, until COVID finally shot the last bullet in Cleartrip’s knees.
The company was forced to lay off 500 employees, while revenues dropped to ₹318 crores!
Anyway, the deal seems like a shrewd move for Flipkart, which gets to own a recognizable brand for pennies, while diversifying its revenue base into the OTA segment without excessive investments scaling it.
That, or perhaps, the alternate was Cleartrip just getting sold to Amazon. We’d never know!
Bottomline: as demand slowly starts to crawl back in the travel game, the digital natives are expected to win an outsized share of the Indian travel market, and Flipkart is just extending a net here to collect as much free $$ it can.
Closing out—likely Zoom’in for a long time still 💉
The US CDC had to put an emergency halt on giving its citizens a shot of the Johnson & Johnson (JNJ) Covid-19 vaccine after some suspicious reports of a rare blood clot surfaced among 6 or so vaccine recipients. All the six cases were women under the age of 50.
The best part about the J&J shot was that it needs just 1 dose, and does not need storage at super low temperatures, making it a much better candidate for mass vaccination campaigns logistically, compared to the other vaccines. Nearly 7 million shots had been given so far, and the suspension kneecaps the US’ efforts to keep the pace up.
Skeptics on the other hand claim 6 in 7 million kinda seems toooooo little for a temporary pause just as things were starting to look better.
Meanwhile, Wall Street resurfaced its love for WFH stonks, with Zoom, Slack, DocuSign, Okta, all on a roll when the suspension news broke out. Still too early to lose the PJs!
What else are we snackin’ 🍿
🧐 The hunt for talent - High on a good quarter, Infosys is set to hire 25,000 freshers over the next 12 months. With 2020 essentially being a dud for entry level employment, its good to see the tides finally changing.
👏 $COIN kills it - Coinbase went public today settling on an $85B+ market cap, signaling crypto’s coming of age on wall street. And it seems like at least half of Twitter made a couple billion as early investors in the company... SMH.
Hit that 💚 if you liked today’s issue.
You can forward this email or share FC on social media by clicking the button below. Thanks and Ciao! 😀
add a profile picture to your email, would be easy for me to identify your email among others.