Tez, but slow 🛵
Navi's leap, Aerospace IPO, and Ads boost profits.
☀️ Morning, it’s Tuesday.
💸 Trump, 2 months away from taking office, spooked markets by proposing 25% new tariffs on Canada & Mexico, along with an extra-10% on China.
📈 Back home, the Sensex kicked off another strong week, extending Friday’s momentum, mostly recovering the month’s losses.
Let’s hit it!
1 Big Thing: Amazon’s quick-commerce play 🚀
Amazon will launch an ultra-fast delivery service in India in December, called Tez, marking its entry into a fiercely competitive quick-commerce market.
What matters: the service will launch by late December or early next year, pulled ahead of its initially planned Q1 rollout. Amazon will focus on daily essentials and grocery, slowly adding more categories.
Context: it seemed uncharacteristic of a Bezos-era Amazon to not recognize the disruptive threat of quick-com for this long. And many will agree—for the past couple of years, an otherwise aggressive Amazon played on its back foot in India, entangled in legal battles and leadership changes.
But the mandate has reversed. New leadership is in place. And it also helps that Amazon stock is out of its post-COVID slump, buying the machine some leeway to spend in areas it considers vital.
Worth noting: quick commerce in India emerged via servicing demand for daily essentials, grocery, and food, which isn’t particularly Amazon’s strong suite—and maybe part of the reason why the company acted slow.
But the disruptive potential of the model is reshaping consumer behaviors, which is a risk too heavy to bear without a serious attempt.
For example, even rival Flipkart already offers a quick commerce service called Minutes. BigBasket (owned by Tata) and Tata Neu’s Neu Flash have also adopted the model.
Big picture: quick-commerce in India is now worth $6 billion, and is expected to explode to $42 billion by 2030. It is serious business.
2. Aerospace IPO liftoff 🛸
Unimech Aerospace, an engineering solutions play, was green lit by SEBI to proceed with a ₹500 crore IPO.
What do they do: the company sells complex built-to-specification components and tooling for aerospace, defense, semiconductor and other high-end manufacturing industries.
For example, they will design, manufacture, and maintain tools for the assembly and maintenance of aircraft engines, among other things.
The IPO deets:
Company was founded in 2016, raised big $ from notable funds
Made over ₹200 crore in sales for the last financial year, with decent profits
Will see a mix of fresh issue and an offer-for-sale during the IPO, with promoters selling shares worth ₹250 crore each.
IPO money will be put to purchase new machinery, meet working capital needs, and repay some debt.
3. Who got the bag? 💰
Entrackr reports that OneCard, one of India’s hottest mobile-first credit card player, is close to wrapping up a ₹240 crore round from Better Tomorrow, Peak XV, and Z47.
OneCard provides co-branded credit cards to first-time users across India, focusing on those underserved by traditional banks. It partners with banks like IDFC First Bank, Federal Bank, and SBM Bank who issue the actual card.
The company turned unicorn after a $100 million round in July 2022 and has raised more than $234 million to date.
Nugget: per Entrackr, Peak XV and Z47 control a 40% stake in OneCard.
While we are on raises 💸
Health supplement platform, HealthKart, has raised a $153 million in a secondary funding round led by ChrysCapital and Motilal Oswal Alternates.
The company, which mostly sells supplements online, is seeing rapid growth with India’s nascent yet strong obsession with protein. Annual revenues top ₹1,000 crores and HealthKart claims EBIDTA profitability. IPO soon?
4. Defense tech heats up 💰
AeroVironment, a western company that sells defense drones, acquired another disruptive startup in the space called Blue Halo, for over $4 billion.
Context: rapid de-globalization is turning defense-tech into a serious theme worldwide. This is one of the largest deals in the drones-space, which validates the category’s rapid growth.
The deets: both companies sell autonomous drones for defense applications, which have been extremely popular in wars like Ukraine.
Why care: drones costing a few thousand dollars are being credited with taking out tanks and ships, causing millions in losses, forever altering the balance of war and transforming warfare.
Here’s an article from Bloomberg if you’re interested.
Big picture: venture-backed defense tech startups have raised over $3.2 billion around the world this year.
What else are we snackin’ 🍿
📈 Ad rush: quick commerce giants are diversifying revenues via ads, with both Blinkit and Zepto set to rake in over ₹1,000 crore ad revenue this financial year. What!
👏 Silent leap: Navi's payment volumes grew by 31% in October, surpassing Cred to become the fourth-largest UPI app in India, trailing only PhonePe, Google Pay, and Paytm.
👍 PAN 2.0: GOI launched a ₹1,435 crore PAN 2.0 Project to transform PAN into a universal business ID.
That’s a wrap for today!
If you’d like to place your brand on this newsletter, let us know.
If you enjoyed today’s issue, hit that 💚