Market summary: 📊
Horrific start to the week in India, as global markets continue to give up 2021 gains, spooked by a disciplined financial environment incoming. US finished in the red too.
S&P 500 - down 1.14%
Nasdaq - down 1.10%
Nifty 50 - down 2.18%
Sensex - down 2.09%
What’s brewing hot? ☕
1️⃣ Year of deals — CNN says 2021 saw more than $5 trillion worth of M&A and other deal making activity worldwide, the most since 2007. An epic run in the stock market, higher corporate profits, bailouts, all played a part. Tech and healthcare, two apparent winners of the pandemic, witnessed the largest number of deals, with US volumes doubling to $2.61 trillion. Europe and Asia jumped 47% and 37%. Nobody expects the party to extend into 2022 though.
2️⃣ EV infra is picking up — Tata Power is setting up more than 1,400 EV chargers in New Delhi, in localities where the company runs the local power distribution network. Deals are being worked out with residential complexes, small businesses, and local municipalities for spots across town. Isolated move, but definitely indicative of how partnerships will shape up over time, atleast starting with dense urban areas.
Grofers likes to dream big 🥦
What happened — the grocery delivery startup which recently changed its name to Blinkit, is staying true to its new image — shutting down operations in ALL markets where it cannot service 10-minute grocery deliveries. Yolo.
Hundreds of millions of dollars pumped by strategic partner Zomato (who’s hedging its own bets), coupled with a red hot quick-delivery market which is becoming the fancy of big money VCs, as well as strong post COVID tailwinds supporting the category — all pushed Grofers’ (Blinkit) hand.
“The Blinkit service will now be available in only the areas where we are able to arrive at users location within 10 minutes (or less)” — said the founder on Twitter.
Some deets — of the 30 cities the company used to service, 12 or so will still work, with majority of the canceled spots being in Tier 2 or 3 regions. Effectively they’re cutting off 75K or 37.5% of the company’s daily active user base with the move. Ouch.
Not the mention the operational discipline, and added costs from customer acquisition to servicing to running dark stores it’ll take to retune the service.
Worth it? We’ll see. Takes balls to shift focus, no doubt there.
Big prize — India’s grocery delivery game is expected to top $25B by 2025. Quickly becoming a crowded game with Swiggy, BigBasket, JioMart, Tata (StarQuik), along with upstarts Dunzo, Zepto, Dhoom, Satvacart fighting.
Not all are quick-delivery yet, but gotta follow competition or be left to taste dust. 🤷♀️
While we’re here, ☝️
Monday’s are for big raises 💰
Hold your end of year funding reports. Used-car marketplace Cars24 raised a mammoth $400 million round last night — doubling valuation to $3.3 billion. Alpha Wave Global led the bid.
Just 3 months back the startup had raised $450 million. A generational opportunity is shaping up, with the new car market completely screwed up by delays, production glitches, pushing consumers to give used cars a legit shot.
Competitors are arming up too —with at least 4 others priced at over a billion dollars in valuation. Cars24 claims 90% market share (say what?) with over 13 million monthly active users across 200 cities.
Meanwhile a cracker of a raise in B2B Commerce, 👇
Industrial goods marketplace, OfBusiness, raised $325 million from Alpha Wave Global again, with Tiger and others pitching in, at a $5 billion tag.
OfBusiness basically runs an Amazon-like platform but for bulk raw material procurement for industrial small businesses. There’s also a lending operation, as well as a bunch of SaaS tools for marketing and lead generation.
Business meanwhile is running on steroids — revenues topped ₹1,748 crores last year, expected to 3x this year, with profitability. The company barely became a unicorn in July 2021, and management is hinting at an IPO in 2022.
Another travel platform greenlit ✈️
What’s poppin’ — Ixigo was okayed by SEBI to go ahead with a $215 million IPO, adding another candidate to the flurry of hot shot IPOs lined up for early next year.
Staple of the online reservation game in India for over 14 years now, its a pretty simple, battle tested business. Revenues still remain modest though, up 21% YoY this year to ₹135.5 crores, with a profit of ₹7.53 crores (vs. a ₹26 crore loss last year). Not bad! 🤞
Recovery from COVID and looming revenge travel is a strong tailwind.
But rising competition, a perennial struggle against compressing margins, and challenges presented to booking platforms from Search engines entering their turf — are some risks the industry battles with. Also, all hinges on how Omicron pans out.
What else are we Snackin’ 🍿
💸 Tax history - Musk will pay over $11 billion in taxes this year. His wealth jumped more than $200 billion since COVID, but most of the tax bill comes from a key compensation plan that went into effect in 2021 rewarding him for hitting goals.
🤝 Done deal - Oracle will pay $28 billion and change for Cerner, closing out an all cash acquisition. Markets don’t seem to love the move as much.
💉 Boosters coming - Bharat Biotech is asking regulatory permission to kick off trials for an intra-nasal COVID vaccine booster dose. Screw needles.
Hit that 💚 if you liked today’s issue.
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