Namaste, Sat Sri Akaal, and Salaam. 🫡

Happy morning, folks!

Today we’re diving into -
- Swiggy’s latest cheeky tactic to print more $$$,
- Homegrown data business CtrlS’s ambitious $2bn plan,
- And, Aakash’s original owners’ return to power.

Our read time today is 4 minutes and 38 seconds - faster than the Mother Dairy waale bhaiya finds your 20Rs chocobar. 🙈

Let's dive in. 👇

Market Vibe Check

Swiggy bumps up it’s micro fee. 💸

TLDR -
- Swiggy is pushing it’s platform fee from 2Rs to 3Rs.
- It’s clearly been working very well for them since they’re slapping a fee on a massive amount of orders.
- The fee is less than 0.4% of their AOV, so it doesn’t really deter anyone too.

Markets have been showering Zomato with lots of love for finally turning profitable.

And now, Swiggy wants some of the action too.

They’re pushing harder on their ‘platform fee’ model to generate some extra cash flow.

In short, Swiggy will now levy a 3 INR charge on any order regardless of who’s ordering, which restaurant it’s coming from, what the order value is, etc.

So let’s do some maths -

On weekdays, Swiggy does ~15.5L orders/day. (1.55mn)

On weekends, Swiggy does ~20.5L orders/day. (2.05mn)

That comes out to 5.2Cr orders a month. (52mn)

Slap a 3Rs. fee on all of them, and you magically create an income stream of 15.6 crore INR/month.

Adds up to over 185 Cr+ ($22m) of extra income each year - and remember, since there are negligible costs associated with this, it’s 185 Cr of pure profit.

Scale is a CRAZY thing.

Aakash reunites with it’s founder. 🧠

TLDR -
- Aakash Chaudhry just became CEO of the company he resigned from last year.
- When he decided to sell the business, COVID had killed revenues. But the rebound is crazy - Unacademy thinks 50%+ of revs will come from offline.
- There is no time pressure on Aakash to complete the deal since they’re profitable, but BYJU’s is under the gun.

Aakash Chaudhry resigned from the board of his own coaching company after fighting with BYJU’s.

But the world has a funny way of giving things to those who deserve them the most - and Aakash is now CEO of Aakash again.

When he sold the business to BYJU’s, it was dealing with a bad case of COVID.

Aakash relied entirely on offline coaching, which meant that their revenue dropped to dangerously low levels due to lockdowns.

At the same time, these edtech companies saw their valuations double every quarter and seeing all this potential upside, Aakash decided to sell the business to BYJU’s.

But few would have predicted that not only would offline coaching come back to life, it would surpass it’s online counterpart.

In fact, Unacademy reckons that offline revenue will be more than 50% of it’s revenue this year.

Aakash might be feeling that they left a LOT of money on the table, which is why all this drama is happening.

And because Aakash is also the only sustainable, profitable arm of BYJU’s, it’s also the only one that doesn’t continuously need cash to survive.

Deal dhamaka…

Indian data-center business splashes cash on a $2 billion plan. ☁️

TLDR -
- CtrlS Datacenters just announced a $2bn investment plan.
- They’re adding 350MW of capacity to their existing 234MW.
- Plays right into the hands of Modi govt’s plans to set up a separate body to regulate all these data players and their blurred lines.

There’s a massive Indian data giant that you’ve never heard of - CtrlS Datacenters.

They’re in the server business, which means that they provide space, power, cooling, etc to anyone who pays them a hefty fee.

CtrlS just dropped plans to spend over $2 billion to cement their spot as India’s fastest growing data king.

Their USP is that they’re the only server company in India with a “4 Rating” - which basically means that their infrastructure is as good as it possibly gets.

Foreign companies like Google, Amazon, and Nvidia are having to deal with more data on their hands to store, which means a bigger payday for businesses like CtrlS.

They currently own 1.2 million sqft of “datacenter”, which they’re expanding to 5 million sqft by 2027.

Modi wants to turn India into a global data center hub & is bringing in a dedicated data center policy to regulate all of the gray areas that come about with data use/abuse.

If all of that wasn’t enough, the CtrlS website looks like it came out of the 90s.

Moral of the story? The unsexier the business, the greater the profits. 🙉

In other news… ☕

Flipkart hits 1.4 BILLION customer visits over the last week (Inc42)

China’s $1 trillion Belt-and-Road plan hits the brakes (BBG)

Netflix launches it’s cloud gaming service (TC)

Citibank fires an analyst for spending too much on food (FT)

Grasim by Aditya Birla gets clearance to raise 4000 Cr more (Mint)

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