Pharma frenzy
Bringing IPL bacc, Mahindra's plan for revival, and snoopy Google.
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What’s brewing hot? ☕
✅ Hook em with loans—the western world is pretty pissed with Belarus after the recent hijacking and forced landing of a RyanAir plane to arrest a journalist. Several European countries have cancelled flights to the country, have stopped air-traffic through the country’s airspace, and the US just imposed crippling economic sanctions on ALL state-owned Belarus companies. Meanwhile, the west’s foe is becoming Putin’s friend, as Russia just issued another $500 million loan to Belarus to help stabilize its economy. Interesting new geopolitical crisis unfolding.
✅ Show must go on—TV rights sold, ad slots booked, gotta make it work! Whatever’s left of the IPL will be taken to the UAE, once again, as BCCI scrambles to salvage the franchise from another catastrophic loss making year. New dates haven’t been booked yet, but games are expected to resume mid-Sep or October. The franchise which was valued at nearly ₹50K crores pre-pandemic, has been on a spiral decline in “value”, as sponsors quit, revenues fall, and eyeballs shift elsewhere.
Pharma wars are back again 💊
Online pharma company PharmEasy is working with Tiger Global and Eduardo Saverin’s B Capital for a $40 million round, at a $1.8 billion valuation.
Second COVID wave, and the demand boost thereof has once again heated up the online meds landscape, reigniting a war for market share. PharmEasy recently acquired Medlife and became the largest independent online pharma platform, with 2 million monthly customers, and monthly revenues topping ₹300 crores.
On the other hand, broad ecommerce giants including Flipkart, Amazon, Reliance and new entrant Tata (1mg) are heating up the space by stomping around and throwing weight, with their well-capitalized balance sheets. Hard for PharmEasy to compete without keeping those cash coffers flush at all times—which is also why an IPO seems imminent.
What matters—COVID changed India’s online pharma game entirely, with nearly 9 million+ users shopping for meds online, expected to spend $2.5 billion+ by 2023. The market is simply massive, and will remain treacherously competitive until an unbeatable leader emerges.
Masterplan for revival 💰
What’s happening—Mahindra & Mahindra will spend over ₹12,000 crores over the next 3 years (~15% of the company’s annual revenue) to rewire the company’s operations and plot a comeback in India's auto game, where the company is slowly losing relevance.
The problem—an increasingly crowded auto market and ever changing consumer tastes are becoming hard for Mahindra to overcome.
In 2013, the company owned 50% share in the SUV business, today reduced down to under 15%—stolen by Kia, Hyundai, Tata who are mercilessly crowding the low and mid-range SUV space.
Revival agenda for Mahindra looks pretty robust:
20+ new models are being planned, including glossy updates to already popular SUVs. In fact, the passenger vehicle business is getting nearly ₹9,000 crore of the capital allocated.
50% of that capital is going to electric vehicles
Rest of the capital will boost the commercial segment, with focus on last-mile mobility and farm equipment
Big picture—Mahindra’s stock had mostly been on a spiral decline for the past 3 years, but slowly started to show life on the back of management’s newfound aggression. This new agenda should help the momentum sustain.
Quick look at a Weekend in Banking 🧐
Banks had an interesting weekend...
HDFC was slapped with a ₹10 crore fine by RBI for selling some third-party products lumped together with auto loans. Sometime early 2020, HDFC basically forced some car loan customers to purchase a vehicle tracking device with a 4 year contract. BUUUTT…. banks aren’t allowed to sell any non-financial product, let alone force lump them into mandatory contracts. 6 employees were fired, HDFC loan-unit head was kicked out, shareholders had to be pacified, and now the fine finally seals the fiasco.
HDFC and SBI Cards were seen sending emails to customers demanding any purchase of crypto be halted, citing some obscure RBI norms, soft-threatening users that failure to do so may result in permanent ban of banking services. Customers obviously did not like it… firstly, “mera paisa, meri marzi”. Secondly, the snooping around on transactions at scale is kinda oddly dystopian, and feels outright wrong. RBI’s meaningless toying around with the entire crypto industry is slowly permeating throughout the legacy financial system.
Pls file both stories into why old banks’ disruption is justified.
Closing out—fintech SPAC you should know about 👏
What happened—micro-savings and investing app Acorns, is going public via a SPAC merger at a $2.2 billion valuation, sealing fate for one of the most popular fintech services worldwide to come out of the last decade’s boom.
Acorns basically integrates with users’ bank accounts, and every time users shop or spend, chips away a rounded dollar sum and stows it into a bare-bones investing account. It's a perfect service to help build your savings pot without knowing, treating yourself to that cool vacation you always wanted, but never seem to have the extra cash for.
Over time though, the company has added basic banking services, and a host of other commodity financial services building the perfect offering for first time investors to warm their feet up to the markets. 4 million users use the product, and markets seem pretty excited.
What else are we snackin’ 🍿
☁️️ Cloud boom unstoppable - Salesforce smashed market estimates for its recently reported quarter, showing the end market for cloud services is on fire. Regulators are also close to signing off on the $27 billion Slack acquisition.
👀 Snoopy Google - Court docs reveal how Google made it harder for users to stop sharing their location data with the company, and even forced OEMs like LG to comply. Does anyone care anymore tho?
Hit that 💚 if you liked today’s issue.
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