Manufacturing rebound 🔥
No stopping for Jio, FB’s integration, and a datacenter investment.
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Market summary: 📊
This week is turning out to be quite impressive so far with both the US and Indian markets gaining significant territory on Thursday.
US:
S&P 500 - up 0.53%
Nasdaq 100 - up 1.45%
India:
Nifty 50 - up 1.51%
Sensex - up 1.65%
Going public... 🖥️
Couple high flyers went public or announced plans to do so all over the world this week. A quick look and the most notable ones...
1️⃣ First off, secretive data mining company Palantir ended up opening at $10 a share, settling down at a market cap of around $16 billion after two trading sessions on the NYSE. All eyes are focusing on next quarter earnings now, with markets projecting 46% growth rates and much better margins.
2️⃣ The second direct lister was workflow management company Asana, which popped a respectable 35% at listing, giving its equity a $4.5 billion valuation. The company is growing at a much faster pace than others, with revenues up 85% last year. Some 1.2 million users use the platform and amidst heavy competition from startups as well as Google and Microsoft, it looks like they have their work carved out.
3️⃣Lastly, we have a domestic player, Biocon Biologics — the subsidiary of Kiran Mazumdar Shaw led Biocon, specifically focussing on the business of biosimilars, is apparently in talks with Goldman Sachs to raise a massive $200-$300 million in a pre-IPO round, seeking a $3.5B+ valuation. The subsidiary was aiming for an IPO in 2 years, marking a huge victory for India’s fledgling pharma industry, and is aiming to ring in $1B+ in revenue by then.
The overdue conversion 🙄
Zuckerberg allowed us to enjoy the unblemished experience of Instagram for as long as he could. Unfortunately, time is up and finally Insta chats will be more tightly integrated with its boring cousin — Facebook Messenger, as part of FB’s grand plans to unify communications on its platform. What an ordeal!
Although it sounds like a nightmare for everyday users, this is a blessing for one group however — small businesses operating on FB. SMBs lacking the budget for fancy customer management tools, can now chat, sell, resolve queries through a unified interface, which we believe has partly forced Zuck’s hand too.
Bottomline: herding its 3B+ users closely and facilitating high-value transactions between them, around ecommerce, comms, payments — all of it, has got to be FB’s ultimate strategy. And they just took a small yet consequential step in that direction. Kevin Systrom probably poured himself an extra glass of Whiskey last night. Read more.
While we’re on the Bigtech + SMB subject — 💪
Google India has partnered with Zoho, Dunzo, Swiggy and a few others to bring a slate of tools that would aid in building online presence for SMBs, for free. The menu is broad and honestly quite impressive — Zoho for example will offer Zoho inventory tools and Commerce tools free to small and medium businesses until next March.
Swiggy and Dunzo will be extending free merchant support and will offer commission-free delivery where applicable. Instamojo will fill in the gaps with payments. From its own end, Google will help simplify discovery of small businesses on Google Search and Maps, and will focus on accelerating the efforts to help businesses build digital presence — skilling for ads, videos, and such. Quite commendable. Read more.
OMG it’s breathing… 👻
India’s manufacturing segment is showing a very strong heartbeat, making swifter recovery than imagined, from the death blow it was handed down due to the lockdowns and follow on mass migration of labor earlier this year — two unprecedented events.
Manufacturing PMI (Purchasing Managers’ Index) — measure of production activity in the country, calculated by surveying leading enterprises, and taking a stock of new orders, inventory levels, employment, and then weighting in against the company’s size—was up to 56.8 for the September month, from 52 levels in August.
This marked the second straight month of expansion and in fact the highest levels India has seen since January 2012 — indicating a roaring comeback. Renewed momentum in export orders and well as domestic consumption of essentials help with the swing back.
Also, piled on inventories are dropping rapidly, while inflows or orders are looking healthy overall. Expectations are set for manufacturing output growth over the next 12 months.
Bottomline: the India machine, although financially a bit fractured form the jolts of this pandemic, is somewhat getting back on track production wise. Maybe we crawl back to growth much faster than we had originally imagined.
Edtechs, edtechs, everywhere... 📚
Latest to join the horse races is ex-Uber exec Bhavik Rathod with his wife, Tripti Ahuja — launching Kyt, a platform delivering live private and small group training sessions for extra-curriculars. The duo are betting big that they can offer the traditional offline neighbourhood schools model, in a digital format, and so far they have signed up prominent personalities in the Chess, Yoga, and Dance arena. Early user list apparently runs into the 1000s and classes begin next week.
A telco investment —
Japanese telco NTT surprised everyone with its plans to invest nearly $2 billion in India over the next 4 years, in a bid to expand its datacenter business domestically. As part of the plan, a new data-centre will be launched in Mumbai, of the size of about 3.75 lakh sq. feet, with 5,000 racks and over 30 MW of load capacity.
NTT also plans on launching a few solar power plants in India, adding to its current portfolio of a 50 MW solar plant in Solapur, Maharashtra, in partnership with Tata Power.
Takeaway: India and south east Asia’s burgeoning digital ecosystem is making India a hotbed for regional data center investment. Analysts project the industry to grow at 23%+ CAGRs through 2022.
And finally, our seasoned fundraising boy...
Jio Platforms scooped up another ₹2,624 crore combined from Intel Capital and Qualcomm, in exchange for 0.39% of equity for Intel, and 0.15% for Qualcomm. The moves make a ton of strategic sense for both chip companies — considering Intel makes processors that go into everything from phones to datacenters Jio would require, while Qualcomm makes modem chips that connect your phone to LTE (and 5G in the future) internet services. They had to jump in.
Tweet of the day -
What else are we snackin’ 🍿
🐦 Dorsey promises change - Twitter is aiming to have at least half of its global workforce constituted by women, up from its current 42.2% levels globally, with hopes to achieve the target by 2025. Kudos.
🚀 Wait Mars, Venus first - ISRO has scheduled to launch its Venus mission for 2025, launching a Venus Infrared Atmospheric Gases Linker instrument, and France will take part in it. CNRS - a French research center has been selected by ISRO after a RFP process.
🏢 Out with the old - Amazon is planning to take over some of Citigroup’s offices in Singapore - highlighting a swift change on the horizon where COVID has accelerated the rise as well as decline of giants. AMZN will lease 3 floors and the staff is expected to move into the space early next year. Nobody is crying for Citi, sorry.
🚚 Crusade against Indian startups - Google has sent notices to food delivery apps Zomato and Swiggy saying that the in app gamification feature on both platforms violate its play store guidelines. Google’s incursions - via policing and demands for fees are increasingly irritating the Indian startup community, forming an anti-Google sentiment in the market locally.
🚨 Airtel will be your cop - Bharti Airtel has launched Security Intelligence Centre, a cybersecurity initiative with VMware, Radware and a few other tech companies, to help enterprises detect and address cyber attacks on data and information. Took a year and about ₹100 crore in spending to set it up apparently.
Hit that 💚 if you liked today’s issue.
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