Namaste, Sat Sri Akaal, and Salaam. 🫡

Happy morning, folks. Hope you thoroughly enjoyed Kohli & KL’s dismantling of Pakistan’s pace attack.🙏

Today we’re diving into -
- Reliance’s retail empire + fundraising party,
- BYJU’s distressed asset sales,
- And Perfios’s mammoth-sized Series D.

Our read time today is 4 minutes and 47 seconds - faster than Kuldeep Yadav can take 5 wickets. 🙈

Let's dive in. 👇

Market Vibe Check

KKR splashes $250mn into Reliance Retail. 🛒

TLDR -
- Reliance picked up $250mn from KRR at a $100bn valuation.
- They’ll use the money for fast fashion expansion + buying out small brands.
- IPO looks set to float around 2025-ish.

Mumbai’s Motabhai 🤝 Qatar's Sheikhs 🤝 New York’s Dealmakers

Reliance Retail just got a fresh $250mn capital infusion from private equity firm KKR - at a valuation of $100 billion flat.

This is hot on the heels of last week’s $1 billion investment at the same valuation by Qatari fund QIA.

Funds are gonna be used for 3 major things -

1 - Fast Fashion

Reliance wants to bet big on fast fashion - cheap clothing that looks good, but has a very short lifespan.

Younger audiences love this stuff, where they can get a cool-looking shirt/dress at a sub-500Rs. price, and then wear it for just long enough until it goes out of fashion.

They’ve tied up with SHEIN to build the backend & logistics for it all.

India is price sensitive, so the market is massive.

2 - “Brand flipping”

Reliance wants to do some private equity of it’s own, and the strategy is very simple -
- identify some killer D2C brands that are struggling
- buy them out at a 20-40% discount
- use your distribution to place their product pan-India, and transform the dhandha overnight
- repeat =)

They need cash on hand to do all of this.

3 - IPO prep

Now that so many new investors have come on board, the old ones will be looking for some exits.

A few rumours say that Reliance Retail is getting ready for a public offering/further stake sales.

Solid hai.

BYJU’s gets a 150-day deadline to fork up $1.2 billion. 🙊

TLDR -
- BYJU’s offered to pay all $1.2bn back in under 150 days.
- To raise the money for this, they’ll sell Epic and GL - two companies they acquired for $1.1bn.
- BYJU’s debt is trading at 49.8 cents on the dollar.

Just 2 months after suing the people who lent them money, BYJU’s has offered to repay their entire $1.2 billion ka loan in full.

The terms of the deal are -
- $300mn in the first 75 days
- $900mn in the next 75 days
- interest is calculated on a pro-rata basis

But BYJU’s is super cash-strapped, which is why they’re heading toward FIRE SALES.

They’re getting rid of 2 companies that they acquired (Great Learning and Epic) for a 15% discount to the price they paid.

BYJU’s bought Epic and GL for $500 and $600 million respectively.

They’re hoping to raise $950m-1bn from selling both of them.

When you factor in deal closing costs, time wasted, etc - BYJU’s still took a 8 figure+ loss on this deal.

And markets know this - their debt is currently trading at 49.8 pennies on the dollar.

Sehwag jaise bhag kar Dravid jaise tik nahi sakte…

Perfios bags a $230 million Series D. 🚀

TLDR -
- Perfios picked up $230mn from Kedaara Capital.
- They give banks/financial instis a 360-degree look into themselves + their clients.
- Very interesting to see a new flock of Indian-domiciled SaaS (software as a service) companies.

SaaS is taking over the world…

Perfios offers financial data analysis software to startups/banks, and they just picked up $230mn from PE firm Kedaara.

The beauty of SaaS is that once your product is built, your only major expenses are your salaries and marketing - it’s all about how well you sell.

Most SaaS companies stumble because they can’t scale well, but Indian software companies sell in USD but spend in INR.

That exchange rate is a life-saver and effectively gives you an extra 8% return on your money if you’re an Indian selling to the world.

Killer. 💪

In other news… ☕

Coinbase completely exits their India operations (Inc42)

Ascend Elements raises $542mn for battery tech (TC)

Arm IPO gets oversubscribed by 10X (BBG)

Divvy Homes goes from $2bn to struggles in a year (TC)

NATO preps their biggest military exercise since Cold War (FT)

And that’s the tea the chai for today.

Thanks for reading, and we hope you enjoyed it. Have a mauj-masti filled day.

Lots of ❤️,

Team Cutting Chai 2