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Market summary: 📊
Can’t stop, won’t stop. Indian stocks rip through on Day 1 of the new year to book more highs. US markets however turned completely upside down, with major indices receding big time.
US:
S&P 500 - down 1.48%
Nasdaq 100 - down 1.50%
India:
Nifty 50 - up 0.92%
Sensex - up 0.64%
Stonks go only up 📈
Sensex is on a goddamned tear. 48,000 was booked in the blink of an eye, and now 50,000 is on the radar. As we say, ho jayega. Investment manager Jefferies sent out a note that it's eyeing 15,800 for Nifty by the end of year, adding more enthusiasm to the fervor.
Retail investors are riding the waves, sipping martinis by the Goan beachside, while bankers and market analysts are struggling to play catchup with their estimates and projections. Last few times these flips in functions came about, shit did not end so well. So we’ll see.
Ma’s goddamn disappeared, TF! 💨
Ant Group’s conflict with the Chinese has taken another weird turn—with speculations arising that Jack Ma, the founder of Alibaba and Ant, has literally disappeared. Poof. Police custody? Abduction? Imprisoned by the Chinese? Or just sitting on his couch drinking beers, with a f*ck this shit vibe. Nobody knows.
Reports suggest he hasn’t been seen publicly for 2 months, and even skipped a reality TV show he was supposed to be the chief guest at, aimed to boost entrepreneurship in Africa. Alibaba stock was down like 2-3% yesterday.
Ma, one of the brightest stories underlining the Chinese growth potential on global stages, was put under the lens when Ant Financial, his fintech venture, was looking to IPO a few weeks ago. We’ve written amply about this in the past—regulators were pissed with the company’s lax practices around lending, governance, all believed to attack the standing of traditional banks and pulled the plug on the IPO at the last minute. To worsen things, Ma had been vocally critical of the Chinese regulators at many occasions, which did not sit well with the ruling party.
There’s no better person the Chinese could use to make an example of for dissent, given the clout, popularity and control Ma draws across the world, especially in the western region. Although we’re very much inclined to believe the “disappearance” rumors are a bit stretched and he’s laying low probably because the Alibaba team chose to be very cautious in its actions, appearances, and speech. Fingers crossed.
Bottomline: you certainly can’t put the worst past China, but the only way they could hurt Ma is by inflicting economic damage if at all, like for example by replacing him from Alibaba helm via a power grab in his absence. In any case, these happenings read terribly for global investor interest in China going forward.
2021 working out aight for CRED 💳
CRED had a good Monday. The company raked in $81 million in a new series C round led by DST Global, while liquidating about $1.2 million worth of early employee stock holdings. The fresh raise now values the fintech venture at over $806 million, just short of a unicorn.
Existing investors Sequoia Capital, Ribbit Capital, Tiger Global, and General Catalyst pitched in as well, while Sofina and Coatue opened their accounts on the cap table this time.
2020 has been a huge blessing for the company—riding high on an already favorable fintech environment boosted by the success of UPI infrastructure and mass acceptance of digital payments nationwide, the company made the most of the booming digital activity in the aftermath of COVID with ballsy IPL ads, a well buttoned product experience, and a flawless marketing machine that was on 24x7.
With that, they managed to end 2020 with nearly 5.9 million users, 35% of which are estimated to be high-ticket or premium spenders. From what we imagine, this is still super early in the game.
Bottomline: access to credit is one of the most fundamental necessities of a robust consumer finance system in a nation. Enforcing habits by gamifying payment of credit card bills is just the beginning, and adjacent products in self-branded cards, and other staple financial products will be the real deal. Watch closely.
Closing out—we’re gonna be better than okay 👋
It's admirable how large traditional businesses in India recovered out of the pandemic on solid footing. Last quarter particularly, we saw several consumer companies, packaged food giants, and auto sellers guide recovery numbers much much better than anticipated.
Continuing that trend, Marico, one of the largest consumer goods players in India yesterday guided for a solid fourth quarter of 2020, with demand substantially bouncing back aided by growth in consumer spending during the festive season as well as pent up consumer spending coming out later in the year in full force.
The guidance reads very well for other companies like Nestle, ITC, Britannia, Palmolive and the likes, and as the earnings season comes up soon, expect some big winners posting big runs.
What else are we snackin’ 🍿
💉 Astrazeneca show on in the UK- 82 year old Brian Pinker from Britain has become the first person to receive the vaccine created by Oxford University and pharmaceutical giant AstraZeneca.
Hit that 💚 if you liked today’s issue.
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