Killing all benchmarks š
Earnings rollup, Whatsappās move, and big tech winning.
Hi š, Tanvi here.
Filter Coffee hits your inbox every morning with notable tech and business news scoops to jump start your day.Ā
Sign up below for free. š
Letās go ahead and get started:
Market summary: š
In all, a decent week in India as key earnings helped the market land slightly higher. US ended the week down as lack of stimulus spooked buyers.
US:
S&P 500 - up 0.34%
Nasdaq 100 - up 0.25%
India:
Nifty 50 - up 0.28%
Sensex - up 0.31%
Some scoops from Dalal Street š§
Before we close this week out, hereās a few nuggets from the finance quarters that matter ā
Asian Paints put up a respectable quarter, quite good in fact when you adjust for a recession. Revenues rose 6%, while net profits grew 1% to ā¹831 crores, as margins improved āunderlining the trend that good companies are using this crunchtime to get leaner and agile. Investors seem pretty pleased with the numbers.
Nestle, the maggie maker, had given a hint into a solid quarter couple days ago and the latest release lived upto the hype. Revenues jumped 10%, as demand for snacks remains elevated and operating profits expanded nearly 15%. The best partāecommerce sales nearly doubled this quarter, now forming 4% of Nestleās total revenue base. Aweeeesssoommeee!
Embracing digital commerceĀ š±
Whatsapp finally took a small yet consequential step to make its platform more useful for SMEs, announcing support for in-app payments, product listings, and some tools in the background to help merchants manage their business.
Highlights:
Easy to check products and 1-click pay within Whatsapp
Merchants will be provided with more tools via partnerships to manage communications, inventory, and such
Merchants will be charged a fee, obviously
Takeaway: FB made $1.2 billion from non-advertising revenue last year. Nearly 2 billion people use Whatsapp, hundreds of millions of who are small merchants. If they charge merchants a tiny fraction as payment processing fees, within no time this will be a $10 billion+ business for FB.
Lastly, this is a huge relief for small merchants, particularly in emerging markets, who donāt have to glue tape tools or struggle with SaaS to digitize their business. And if youāre an FB shareholder...
Who got the cash? š°
Flipkartās copycat strategy continues unabated. Mimicking Relianceās strategic buyout of Futureās assets, Flipkart yesterday went out and bought itself a 7.8% piece of a major competitor of Futureās, Aditya Birla Fashion and Retail for some $204 million.
Birlaās 3,000+ stores nationwide including Kishore Biyaniās baby Pantaloons (which Birla had bought in 2012), will be now at Flipkartās disposal, with products catalogue beefing up Flipkartās online offering, while the retail locations could help solidify Flipkartās delivery and fulfillment operations. Post deal, Aditya Birla wouldāve successfully wrapped up raising ā¹2,500 crore for his retail empire this year alone.
Takeaway: thereās tons of synergies in these online-offline matchups and we get why Flipkart would do it, but we wonder what such unhindered consolidation and teaming up in the big-box commerce arena does to competition in the market!Ā
Hard to imagine how these deals donāt hurt small merchants and upcoming brands who canāt benefit from such scale or capital glut. Regulators donāt seem to care one bit. Or even a small vocal warning wouldāve been enough.
Killing all benchmarks š
Initial data released earlier this week suggests Appleās chargerless iPhone 12 is, in fact, getting a much better reception in the market than last yearās device, with pre-orders over the first-weekend running into about 2 million units, 2.5x more than the 0.8 million for iPhone 11 last year.Ā
Imagine thatāApple takes out accessories (charger) and bumps up prices a notch, yet 2 million people, overnight, order $800 phones in the middle of one of the largest economic slumps this generation has ever seen worldwide.
If that doesnāt highlight Appleās brand power, we donāt know what does. Thatās what dreams of every company are made up of.
Another big-tech thatās winning šŖ
Amazon continued its dominant march through a highly successful prime day event worldwideāwith estimates projecting $10.4 billion in revenue collected on a single day, up 49% compared to last year. Freaking NUTSSSS!
The event saw people worldwide buying 260 million units of products and the momentum is strong to carry the giant through an unprecedented global holiday season.
What matters: Indians are estimated to spend $6.5 billion buying stuff online during this holiday season, 75% of which will come this month alone. Amazon and its compadres are out looting, snatching share from the average vendor down the street while he remains battered by lockdowns. Great for you if youāre a shareholder of these companies, otherwise thereās very little to be excited about here.
If you have been blessed with the power to do so, support small businesses my man.
What else are we snackinā šæ
š· Low infections breathe hope - The number of coronavirus cases reported in the last 24 hours have remained below 60K, with recoveries crossing the 69 lakh mark. Currently there are about 7.2 lakh active infections reported in the country, amounting to about 9.3% of the total caseload.
šļø TWTR and FB to be grilled - A joint committee of parliament has issued summons against Twitter and Facebook to get oral evidence on the issues of data and privacy. The committee is led by BJP MP Meenakshi Lekhi and has 20 members from the Lok Sabha and 10 members from the Rajya Sabha. Lawmakers are irked however because Amazon refused to come.
š Funding vaccine distribution coffers - GOI has set aside $7 billion to vaccinate the people of India, with costs projected around $6-$7 per person for vaccination. This allocation comes from the current fiscal yearās budget and will be revised next year again.
Hit that š if you liked todayās issue.
You can forward this email or share FC on social media by clicking the button below. Thanks and Ciao! š