Zuck wants one🎙️
Titan killing it, Fintech unstoppable, and digital grocery winning.
Hi 👋, Tanvi here.
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Market summary: 📊
Decent bounceback in India, with markets resuming upward rally on the back of a few solid earnings reports this week. US markets turned directions too, with tech particularly gaining ground.
US:
S&P 500 - up 0.17%
Nasdaq 100 - up 0.58%
India:
Nifty 50 - up 0.44%
Sensex - up 0.43%
What’s hot bruh? ☕
✅ Horses, vaccines, and finance—Adar Poonawalla of the Serum Institute will spend about $441 million to acquire a 60% stake in a lending player Magma Fincorp, bringing the company under the fold of the Poonawalla Finance empire. Magma, which is essentially a financier for vehicles and home loans, operates in over 20 states across the nation, serving consumer lending needs via its 200+ locations branch network. Magma stock jumped 10% during trading when the news broke out.
✅ Dorsey’s love for decentralization—Jack Dorsey threw the markets a puzzle by rambling something about decentralized social networks that half the investors tuned in for Twitter's earnings call could barely understand. Basically, Jack sees potential in building a social network where there is some sort of an App Store that allows users to “pick” recommendation algorithms and effectively control what you see on your feed. He’s arguing it's wrong for platforms to “condition” all users on algos that are trained on a similar dataset, and in the end make us all think alike. Bored investors couldn’t care less about anything other than profits for next quarter 🤷♀️
✅ Bumble about to make history—the dating app had a blockbuster listing, raising nearly $2.15 billion for its IPO as stock popped nearly 80% when trading opened yesterday. Valuation is now set at nearly $10 billion. With the dating space dominated by Match group (the guys running Tinder, Hinge, etc.), markets are counting on Bumble to take on the leader and displace some market share in the process. BTW, CEO Whitney Wolfe Herd is the youngest woman CEO to take a company to a billion dollar+ IPO ever. We wrote a quick thread on them a while ago.
When Titan reports, everyone sits up ⌚
Titan Company, one of the most widely followed stocks on Dalal Street, grew its revenues by nearly 17% YoY for the last 3 months of 2020, thanks to strong bounceback in consumer demand for the company’s jewelry, watches, and eyewear products during the festive season.
Quick look at a few details:
Total revenues of ₹7,287 crores, up 17% YoY—which is impressive for a recession year
Profits actually declined 10%, but that’s due to a tiny one-time financial charge the company faced on one of its subsidiaries
Jewelry business grew 16%!
Watches and Eyewear returned to about ~90% of pre-pandemic volumes
In all, the company told investors it's seeing positive signs of underlying demand significantly improving, as consumers begin to actively step out, and more eagerly open their wallets. The performance and Titan’s confidence sets up a good sentiment for the broad consumer market in India.
Digital grocery made a killing in 2020 🛒
2020 was a watershed year for digital grocery sales, with lockdowns forcing reluctant Indian consumers who typically prefer to rely on the convenience of neighborhood vendors, to finally cave in and default to purchasing everything online. And the platforms had a feast.
For the entire year, total digital grocery revenues in India grew nearly 65% to ₹6,280 crores. Big Basket is estimated to lead charge, growing nearly 43% in the year, and taking about 50% market share, with Grofers, Spencer’s Retail, DMart among other notable winners.
Now lockdowns may be easing going forward, but habits are hard to break, and the catalysts supporting the trend are expected to sustain well through 2021 and later. This time however, Reliance, Flipkart, and Amazon are coming after the market too, and the battle for domination will be hot.
Key takeaway: the e-grocery market is expected to expand at over 50%+ growth rates for the next 5 years, easily topping $15-$17 billion in total gross volumes by then. It’s going to be a passionately fought war between the digital giants, the old school retailers, as well as surprise old-school entrants like the Tata’s with their super app.
Hottest from Venture avenue 💰
Payment aggregator BharatPe raised a massive $108 million series D round, at a $900 million valuation—just short of a unicorn. Coatue led the bid with existing investors Ribbit, Sequoia, Steadview Capital and a bunch of others piling on.
BharatPe basically provides small merchants with a unified payments service that aggregates multiple payment options under a single QR code, giving merchants the flexibility to accept payments from any wallet or UPI service. So far, the service remains free, as merchants flock to it for its convenience.
Just last month the company displaced Google to become the largest UPI processor in India, with annual payment processing run rate closing in on $6 billion. An adjacent cash-flow based lending business is kicking ass too, with more than $250 million of monthly loans serviced through financing partners. Fresh funds will go towards fueling growth, with eyes set on scaling payment volumes at least 5x by 2023.
Zuck FOMO’ing real hard 🎙️
Somebody brought Zuck onto Clubhouse, now he’s busy getting one for himself. Seriously though, barely 5 days after Mark joined in on a conversation on CH to talk about the future of augmented and virtual reality, reports are emerging that FB is cooking up its own audio social service.
There’s really not much of surprise here—FB is notorious for copying the best of features from services they can’t buy or won’t sell to them. One of the good things about that strategy is that it picks the best “features” and brings them widely to billions of users overnight, giving these features mass appeal, and giving creators more options to build audiences.
In any case, there’s little information around how FB is thinking about structuring the service, but given that they have experience bundling video communications with Instagram, and with audio calling on Whatsapp, this doesn’t seem like an unimaginable task at hand.
While we’re on this topic, 📈
To date, Clubhouse has seen nearly 4.7 million downloads, up from the million or so downloads they announced when a16z invested in the company a month or so ago. All the who’s who of big tech hopping on for a quick chat helped draw people from all corners of the world.
What else are we Snackin’ 🍿
📷 Snap’s got some moves - in an interesting move, Snapchat has partnered with Moj, one of the leading short video platforms around here, to integrate and bring Snap’s camera kit technology to users on its platform, unlocking a range of augmented reality features for Moj creators to put to use within the service. Snap’s AR kit tech is expected to be at the top of its game, and if Moj does a decent job of integrating it well, they could have a serious competitive advantage building up. FYI—Snap’s an investor in Moj’s parent Sharechat.
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