Pawan Kumar Rai

Mukesh Ambani and Paytm just taught us a lesson on why we should not make big bets in the stock markets based on news alone. Here is what it is-

Well, after RBI’s crackdown on Paytm Payments Bank, the listed entity One 97 Communications has been in a free fall. The stock has crashed nearly 40%.

But yesterday, a news report claimed that Mukesh Ambani’s Jio Financial Services (JFS) will be buying the distressed Paytm. This would help JFS build distribution in the fintech space.

And JFS zoomed over 15% in a single day, touching its all-time high! Thousands of retailers were rushing to buy the stock to get in on the hype.

But the thing is, if these folks had dug in a little before placing their bets, they would have realized that Paytm can not sell its wallet business.

You see, Paytm surrendered its Prepaid Payment Instrument Licence (PPI) that allows it to operate, expand, or transfer its wallet business in early 2018.

They did this to get a Payments Bank license instead.

This means, Paytm cannot sell its wallet business to anyone, even Mukesh Ambani, making the news about its sale to Jio mere speculation.

Both Jio and Paytm put out a statement denying the news but after market hours. By that time people could not withdraw their money or hedge their bets.

And as the market opened today, JFS is tumbling down! It is already down 5% in today’s trading session.

This incident is a great example of why you should not trade in the stock markets based on news alone and should rely on thorough research before placing bets.

What do you think? Let us know in the comments and follow Finshots for more insightful content!

FB, Google, Insta, WhatsApp, etc are blocked in China. When you can't get into China, India becomes the next most lucrative market for you.

The 3rd most populous country, the US, has ~33Cr people. And the FB app and #WhatsApp have 30Cr & 40Cr users in India respectively.

Now you see why India is the most important market for FB. They have been trying hard to get more users on their platforms.

Remember Free Basics? Launched in 2015, FB wanted to offer India free internet with a select set of apps. Unfortunately, they couldn't get it off the ground, because it violated the core tenets of net neutrality- an idea that promotes equal access to all internet communication

Two years later, they tried launching WhatsApp Pay and had a very difficult time getting past India's regulatory hurdles.

So perhaps FB now realizes that doing business in India is almost impossible without a local strategic partner. And hence buying 9.9% of #jio made perfect sense for them.

And with FB's help, jio can disrupt a lot of markets OTT, payments, e-commerce, etc. It's the most powerful combo you can think of- distribution, tech, and money

Subscribe Finshots https://bit.ly/2XXDUDP

D-Mart reported a 25% increase in revenues this quarter. It also has the highest industry-wide profit at ~₹16 billion — leaving its competitors in the dust.

Though running a supermarket chain in India is no easy feat — it seems like D-Mart has cracked the code!

So, how did D-Mart get here? Let’s break down a few of its strategies:

1.  Low Marketing Expense: D-Mart believes in offering a no-frills shopping experience - that means no flashy stores in malls or costly advertising campaigns.  For instance: While Future Retail spent 6.8% of its revenues on advertising & marketing in FY2020 - D-Mart spent just 0.4%. And what they save on these expenditures is passed on to the customer as extra benefits.

2. Store Ownership/Location: Unlike competitors, DMart purchases/leases land for its stores instead of renting. This helps them significantly save up on recurring expenses like rent - which typically eat up 5-10% of a supermarket’s revenues. Plus, you would usually come across these stores in suburbs of Tier-1 cities & Tier2/3 cities where property prices are relatively lower.

3. Pricing strategy: DMart’s EDLP (Everyday Low Pricing) strategy is nearly unbeatable. The biggest reason why people flock to the stores is the lower prices compared to their competition. While this results in lower margins, it also leads to more footfall and bumps up sales in a big way.

But how is DMart able to consistently offer low prices? One way is by paying its vendors faster - at an average of 9 days compared to the industry standard of 30-45 days. As vendors get their money faster, they tend to offer additional discounts to DMart which then gets passed on to its customers.

4. Product Mix: DMart knows what people buy most frequently and simply stocks up on that. They don’t stock slow-moving niche items. This allows it to turn over its inventory very quickly. That means its products basically fly off the shelves. Its inventory turnover is over 13 times when compared to peers that languish at 6 times and lower.

What are your thoughts on D-Mart’s strategy?

Follow & subscribe to Finshots for more insightful content about business, finance & the economy.

✅ Join our 500k readers in staying up-to-date on all things business & finance in less than 3 mins: https://bit.ly/3We9Ez6

Recently, one of the leading VC firm visited our office for a general catchup on how we are scaling Ditto.

During the interaction, one of them asked how many policies Ditto sold in the last FY.

To which I honestly  replied that I really couldn't remember the exact numbers. I even mentioned that any of our founding members would probably say the same.

This came as an absolute surprise to them as they felt being a founder,  these numbers should be on  top of my mind.

I was not very surprised on hearing  this from a venture capital firm whose day in day out is all about interacting with founders who are looking to raise funds & analysing the business

Little did they know that at Ditto, our priorities are completely different & we are neither looking to raise any capital nor into that zone of playing a valuation game since we started.

If we were  really into that zone , by now Finshots would have been under a paywall but we managed to keep it free.

If we were really into that zone , by now we would have already  started offering various products like motor , Group , ULIPs etc and could have scaled our revenue up crazily.

We hardly even discuss about our sales/revenue numbers & rarely do any kind of meetings to discuss past quarter or FY numbers.

From day 1 , our philosophy has been crystal clear that if we add real value in the life of a customer through our offerings , we would be able to find a way to grow & monetize.

Our top priority has always been ensuring that people are genuinely satisfied with our products. Do they truly love our services? What can we do next to make our offerings even better?

Everything else has always been secondary. Be it sales number or profit.

Our journey has always been about the love and passion that we put into our work, not just the numbers it produces.

Doing things for the sake of it was never in the DNA of Team Ditto Insurance & Finshots even if that means letting go of some % of revenue or growth. It was always about the process rather than the outcome. We have consciously stayed away from doing things that we cant relate to or didn’t love doing.

This brings to mind a beautiful saying by Vincent Van Gogh:

“It is good to love many things, for therein lies the true strength, and whosoever loves much performs much, and can accomplish much, and what is done in love is well done.”

2020 has probably been a roller coaster year for all of us. In the midst of all the doom and gloom surrounding Covid, we managed to

1. Scale Finshots from 50k to 300k+ subscribers
2. Launch one of the best apps of 2020 ( Awarded by Google)
3. Top the podcast chart ( at no. 2 )
4. Get 175k+ app downloads in 9 months of launch
5. 4.9/5 rating on Playstore after 8500+ reviews
6. Launch Ditto ( bit.ly/34oGOUM) to make Insurance space simple and easy to understand for a layman.

We would like to thank you all for your constant love and support. Wishing you all a superb 2021 🙂

Your flight tickets are about to get more expensive, and you can’t do anything about it!

You see, a report by the Centre for Aviation (CAPA) says that out of the nearly 700 aircraft in India,  200 will be grounded by March 2024!

This means, over 30% of Indian aircraft will be out of service. And all airlines would be impacted by this.

As per the report, 90 IndiGo aircraft, over 30 aircraft each of Air India and Spice Jet will be grounded. In addition to that, 54 aircraft of Go First are already grounded due to their bankruptcy proceedings.

The majority of these aircraft would be grounded as their components need repair to meet the safety regulations for flying. Some are missing parts that need to be brought from the other side of the world.

And these supply chain issues are most likely to cause a swift hike in flight tickets. Now, if you think about it, you will realize that the Indian aviation sector keeps falling into duress every now and then.

Just last week the whole aviation network came to a halt because of a dense fog over Delhi. And every few months there are reports of canceled flights, long lines for security checks, delays in operation, etc.

But what is the reason behind this? Is something bogging down the Indian aviation sector?

Well, it seems like the supporting infrastructure has yet to grow at pace with the interest in air travel.

In the last decade, India's air traffic has grown 5 times (from 61.42 million to 327 million). But the number of aircraft has only grown from 400 to 700, and airports have only grown from 74 to 141.

And this mismatch is often the reason why the aviation sector faces frequent issues.

But what do you think can be done to fix this? Let us know in the comments.

And follow Finshots for more interesting content.

One of our advisors asked, “Why is our company named Tacterial Consulting Private Limited and not Finshots Consulting Private Limited or Ditto Insurance Private Limited?“

Perhaps people don’t know the story of how Tacterial came about

1) We started off with the brand name Finception. We applied for the name Finception private limited. MCA rejected it

2) We thought the government wasn’t happy with us. So to appease the govt we picked “Acche din private limited”. They rejected that too

3) By now the process had gone on for a month and we were really frustrated. So we thought we’d make up a random name, thinking they’d reject it anyway. We came up with the name Tacterial Consulting because one of us had a bacterial infection at the time.

They accepted it and the name stuck 😂

Finshots has 500+ articles on the website. Combine that with 600+ social media posts, and that effectively gives you over 1100 posts.

1000+ TOPICS ON BIZ/FINANCE!!

So how exactly do you research on so many topics? Surely, you would run out of steam eventually?

Well, that's not necessarily true.

See, mere research might help you to a point, but it won't fetch you topics endlessly. Instead, it all boils down to your curiosity. How intrigued are you by finance, business, and economics, really?

Are you willing to question everyday items in your household? Are you paying attention to small kiranas on your street? Are you constantly asking how the rupee notes in your hand, even came into your hand?

Once you're questioning everything around you, you stop looking for topics, because the world becomes the very essence of your research. So the next time you ask- How does Finshots land so many insightful pieces, understand that we are also like you. But we're always curious. So stay curious.

Also, if you're looking to know more about Finshots' new initiative, do check out Ditto Insurance, where we give you unbiased and personalized advice on health & life insurance.

Who dominates the Indian mobile telecom industry?

Subscribe to Finshots for more- https://lnkd.in/gP27cnfR

#india #finance #business #telecom

Most folks who are interested in business & financial news often struggle with complex and intimidating jargon. So, we thought why not simplify it?

Here's presenting the Jargon of the Day series - a Finshots initiative where we break down daunting jargon in a language you'd understand.

And if you like your financial updates jargon-free, then don't forget to subscribe to our daily newsletter- https://bit.ly/47hFvG2

Finshots cannot grow on Instagram !

Yes, thats what we thought initially that maybe people wont consume serious financial content on Instagram

We had almost made up our mind of not focussing there. And then pandemic happened, seeing the sudden spike in online content consumption.

We decided to give it one more shot !

And guess what, Dhruv with just few interns managed to pull this off, increasing Finshots followers from 8k to 100k in less than 6 months.

Making Finshots one of the few financial news focussed insta handles having over 100k Followers🙂

He is planning to do the same with Ditto (https://joinditto.in/) Instagram as well.