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✅ COVID takes over, again—it's getting pretty bad here with 261K new cases reported in the last 24 hours, putting daily caseload 1,500% higher on average than what we were seeing at the end of 2020. Literally every post on social media is a cry for help, support, or compliance. Odds suggest we’re still early in a likely long-ended second wave, but the economic, social, and personal consequences of this run look far more detrimental already. For folks on our reader list who’re affected, stay strong. The rest, mask up, sit TF at home!
✅ Doubling down, big time—people stopped opening Clubhouse a long time ago, but that’s not gonna bother a16z one bit. The VC firm along with DST Global, and a few others just mailed another fat check to Clubhouse management, as part of a Series C, touting progress in hiring, infrastructure, and newly launched payments functionality. Chatter on Twitter indicates folks were quite surprised with a16z’s conviction, but we think Twitter’s recent interest in a $4B acquisition may have moved the pen…
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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.
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If you happen to drop by, tell them Coffee sent you!
Kicking off the week... 💪
when the leading personalities talk, the markets look for clues, and last week offered us a few...
“I’m incredibly bullish on the stock market”, said the CEO of Blackrock, the largest money manager in the world, with nearly $9 trillion in assets under their purview.
If you’d ask any rando redditor, you’d probably get the same quality of “insight”, but the only difference here is that when Larry Fink talks, big money institutions listen, and if he says he’s bullish, those checks with some extra zeroes are gonna follow into stocks… coming from pensioners, endowments, sovereign wealth funds, and FOMOing bears who’d been chilling on the sidelines for the last 18 months waiting for a pullback.
Aka, we could have a good run incoming. Thank you Larry.
Meanwhile back in India,
Big-bull Rakesh JhunJhunwala brushed off India’s unicorn frenzy as an inconsequential thing that’s likely to fade away pretty soon.
“In the public market, valuations are based on cash flows, when will these startups get cash flows?” asked Mr. J in a discussion with Bloomberg Quint.
The tussle between value and growth markets is as old as time itself, so that’s forgiven—but it's about time India’s venture-behemoths make attempts to bridge the gap with Dalal Street’s taste for profitability, else those promised IPOs are gonna have it pretty tough.
Onwards…
Qualcomm bets on Indian hardware 🎧
India’s own D2C consumer electronics brand boAt got a ₹50 crore check from US chipmaker and 5G legend Qualcomm, barely months after boAt had raised nearly $100 million from global PE behemoth Warburg Pincus.
That’s another feather in the cap for the upstart that ended last year on an unimaginable feat, booking No. 5 position in the global wearable electronics market, holding 2.6% market share, sitting right next to Google’s fitbit.
The COVID-induced boom in devices, thanks to remote learning and work from home upgrades, helped boAt grow at a breathtaking pace through 2020, with revenues growing 100%+ and employee count doubling. The company used the momentum to double down on an R&D unit in Bengaluru.
And R&D is where Qualcomm makes most of its dough, and we’re guessing the two brands are likely to work very closely to give Qualcomm 5G modems a way into boAt connected devices, as 5G deployments slowly start to pick pace in India.
Bottomline: Indian wearable hardware market is estimated to top $1.8 billion in 2021—with user penetration still mostly under 5% as of today nationwide. We’re looking at a long runway, as demand particularly from first time buyers in heartland India starts to peak, and so far boAt seems to have a solid grip on the game.
Tis’ the season of earnings 📈
Investors were busy over the weekend deciphering clues in the earnings reports of two key companies, tryna catch a whiff of the market’s mood through the new week.
First up, Wipro confirmed what we’d seen with the other IT giants TCS and INFY earlier last week. Growth is returning, profits are improving, and the rate of new business walking through the door in 2021 looks promising.
Quick look at the numbers:
Revenues up 6% YoY to $2.2 billion
Profits of $407 million, were better than expected
Saw some big deal wins in India and the US
Expects 2-4% growth next quarter—which is not too optimistic, but not too conservative either
Overall, investors seem pretty satisfied with the predictability of the stats the IT industry has posted so far, benefits of which will likely trickle down through other sectors, as employment makes a strong return, and broad consumption improves.
Turning heads to Dalal Street’s favorite—HDFC bank,
The bank kinda showed the yellow light, putting out mixed numbers, which indicate a phenomenal quarter, but hinted at caution going forward due to the uncertainty of COVID 2.0!
Interest income grew a nice 12% YoY to ₹17,120 crores, showing loans are being paid on time
Profits fell tad short of expectations, at ₹8,186 crores, but still way better compared to last year
HDFC suspended dividend, claiming fresh rise in cases meant looming uncertainty, and to hand out cash in these conditions would be irresponsible
In all, the print was kinda reflective of the black-storm banks are heading into for the next quarter— especially the leading institutions , who despite having managed to pull off a safe transition through most of 2020, will be put through another thorough test as India pulls through this second wave mess. Buckle up, sit tight.
Closing out—Doge takes down Robin 🐶
Surge in volume coming from FOMO’ed $DOGE buyers strained Robinhood’s systems, taking the service down for a good couple hours. Users were able to get their crypto orders through, while some users weren’t able to see any notifications, messing up their trade alerts.
That’s probably the 3rd or so major infrastructure-driven outage the app has grappled with, even as it plans a date with the markets for an IPO anytime now.
Meanwhile, all major crypto assets took a heavy beating yesterday, down 10-30% over the last 24 hours, after the US threatened to literally decimate financial institutions that were knowledgeable about the use of Crypto for money laundering and all the under-the-table stuff, and weren’t doing anything about it.
Otherwise a quiet news day with COVID wrought devastation controlling the news cycles. Stay safe, and see ya’ll tomorrow...
What else are we snackin’ 🍿
🍎 Apple’s tryna be transparent - in a surprise open letter, Apple disclosed how much it pays music artists for using their songs on the Apple music app—an embarrassing 1 cent per stream on average! But that’s still 2x what Spotify pays, and Apple is hoping that’ll let them in the good books. But damn the music industry is brutal!
✋ No to gambling - GOI is considering a cap on UPI payment volumes for gaming apps, because a surge in low ticket transactions, especially during the times of IPL is straining the UPI system, and also the fact that most of these apps are unregulated, encouraging borderline gambling.
Hit that 💚 if you liked today’s issue.
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