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Tale of the Tape

Happy weekend everyone! Markets closed up for a second consecutive week. 

Nifty and Sensex bounced from day’s low to close flat. Profit booking and mixed global cues kept markets range-bound. Midcaps and Smallcaps saw decent gains, both rose 0.8% each. 👊 

Most sectors closed higher. PSU Banks (+2.6%) and Real Estate (+2.3%) led the charge. Pharma closed flat. 😌

Bajaj Electricals jumped +8%. Board approved to reorganize the company’s business segments to unlock shareholder value. 🤓

Star Health Insurance had a quiet listing. The stock closed at Rs 907 per share, up 1% from its issue price. 😞

LIC received the green signal to increase its stake in IndusInd Bank to 10%. 🤝 The stock closed flat. 

Indian Energy Exchange (+9%) extended gains to day 4. The stock is up 18% in that period. 📈

Deepak Fertilizers (+2%) will invest Rs 2,200 cr to set up a new ammonium nitrate plant. 🏭

Ratnamani Metals (+3%) won new orders worth Rs 190 cr. 🤑

AstraZeneca India (+2%) is in talks with health authorities to launch Covid drug. 💊

IPO Update. Shriram Properties IPO got oversubscribed ~5x on the final day. Metro Brands IPO received lukewarm response, subscribing just 24%.

Cryptos continued to dash lower. Bitcoin tumbled 2.5%. Ethereum dropped 5%. Solana, Cardano and Ripple fell between 4%-7%. 😰

Here are the closing prints:

Nifty 17,511 -0.1%
Sensex 58,786 -0.1%
Bank Nifty 37,105 +0.1%

One More!

MedPlus IPO will open on Dec 13. The price band is fixed at Rs 780-796 per share. The company plans to raise Rs 1,398 cr from the markets.💸

Founded in 2006, MedPlus is already the 2nd largest pharmacy retailer in India. 🏥 They started with only 48 stores in Hyderabad to now owning over 2,000 stores across the country. Their stores offer a wide range of pharmaceutical, wellness, and FMCG products. They plan to use the IPO proceeds to continue their growth story and scale up its national presence. 👊

Financial Snapshot:

  • FY21 Revenue: Rs 3,069 cr; +7% YoY
  • FY21 Net profit: Rs 63 cr; +30X YoY

India’s retail pharmacy market is expected to grow 25% compounded annually by 2025, to reach $36 billion. 💰 The industry’s key growth drivers include Covid, rising aging population, growing middle class, and an overall demand increase and focus on healthcare. 

Bulls will point out the huge market opportunity, strong brand presence, and its leadership position. Bears will highlight the strict drug regulations, drugs pricing, growth execution risk, and probably valuation! ⚖️

All Hail Fintechs

Sequoia Capital, known to be one of the top US-based venture capital firms, expects Indian fintech startup valuations to grow 10x to $500 billion by 2030. 🤑

As you’d expect, they are citing the low penetration of banking and financial services in India. Recent bullishness here has led to Indian fintech startups attracting over $7 billion funding in 2021! Worth noting, Sequoia is putting their money where their mouth is. They’ve already invested in well-known startups like Razorpay, Pine Labs, Coinswitch, Cred, Groww, and MoneyTap. 💰 

Big picture: Growth in financial adoption is a big thing and happening across segments like payments, insurance, lending, investing, and even crypto. Fintech bulls point to UPI adoption and say the online lending market could hit $350 billion in itself by 2023. This has also attracted many new entrants, including big tech firms like Google and Amazon, who are partnering with banks to enter the local fintech scene.  😮

Overall, intense fintech competition is good for consumers. Heavy marketing spend, lower fees, and cool TV commercials are driving new entrants to the banking network. All good news for our country’s development. 🤞

Closer to Vision

WhatsApp has big things planned for India. You can expect to hear the phrase “WhatsApp Commerce” a lot more in the coming weeks and months. 💳

Earning revenue from WhatsApp, since it’s free to use, is a huge focus for Meta’s top boss Mark Zuckerberg. We all know they need to diversify away from ads and get the regulators off their backs. So, Meta believes e-commerce is the way, and India could be the first step in their playbook. ✅

We expect the Reliance Jio partnership to be the foundation (in case you forgot, Meta invested $5.7 billion into Jio last year). JioMart users can now place orders and make payments via WhatsApp. Over time, we’d expect Meta to take a small percentage fee. 😉 Going forward, you can expect many more brands to follow suit. 

It has not been a smooth ride for WhatsApp payments in India. After a 2018 launch, the payment service was rolled out only in 2020. Regulatory hurdles and concerns over data storage slowed things down. Looks like they’re all set now though! 🎢

What’s the takeaway? Meta wants WhatsApp to be like Tencent’s WeChat in China. They have a whopping 2+ billion users, so they have a real shot at pulling it off. Imagine the transaction revenue if this works out! 🤯

Movers and Shakers

Here’s a look at this week’s top movers from the Nifty 500. Network18 Media took the pole position after rallying ~50%. Trident (+23%) reversed most of its losses from last week. JSW Energy (-7.5%) snapped its two-week gaining streak. Aavas Financiers (-7%) posted its worst single week loss in 4 months. Check out the charts below: