Namaste, Sat Sri Akaal, and Salaam. 🫡

Happy Monday folks. Hope you had a brilliant weekend.

Today we’re diving into -
- Saudi Arabia’s $5bn investment into the Indian Premier League,
- BYJU’s brilliantly disastrous (and incomplete) financials,
- And Zomato’s hardcore profit push.

Our read time today is 4 minutes and 56 seconds - faster than South Africa found themselves back in the hotel room. 🙈

Let's dive in. 👇

Market Vibe Check

Saudi’s sheikhs catch the cricket craze. 🏏

TLDR -
- Saudi wants to invest $5bn at a $30bn valuation into IPL
- There is BIG potential to take IPL global (esp to Western nations, where Indian diaspora is large)
- Cash flow must be brilliant; IPL matches are worth $15m+ on average due to ad revenues

India is a nation that’s dominated by one sport, and one sport alone - cricket.

It’s been a staple of Indian culture ever since the British brought it to Kolkata in the 1700s.

15 years back, a few folks realised that they could cash in on India’s cricket craze - thus giving birth to the Indian Premier League.

IPL combined some hardcore desi Bollywood-inspired dhamaka with American-style marketing genius. And before you know it, you have a league with over 1 billion unique viewers and a per-match value (based on ad sales) of over $15.1 million.

Saudi Arabia has been observing this drama for a while now, and they’re putting their money where their mouth is.

Prince Mohammed Bin Salman's advisors pitched BCCI on the idea of
- moving the IPL league to a new holding company
- infusing $5 billion at a $30 billion valuation
- using that money to make cricket EXPLODE throughout the world (target West, large Indian diaspora, etc)

Saudi sports officials have been going ham of late on “new” sports, which have small fan bases but are fast-growing - they spent over $1bn on their F1 circuit and spend over $1.2bn a year on their golf league.

Ben Stokes said it best - “you can’t compete with money, and definitely not with the kind of money Saudi is offering.”

Modi magic… except his name starts with a “L”, not a “N”.

Profits become a full-time thing for Zomato. 💸

TLDR -
- Zomato 2Xed revenues and made a profit of 36 Cr this last quarter.
- They made a total profit of 200+ Cr from food delivery, but it was offset by their other smaller business units.
- Brilliant to see such operational excellence on display - the shares are up over 150% this year.

Zomato went from being mocked and ridiculed for their losses to being a good reminder that execution is EVERYTHING when running a startup.

They just reported their second ever profit of 36 Cr, on a total revenue growth of 2X.

The breakup of this is as follows -
- 🟩 204 crore profit from food delivery
- 🟥 125 crore loss from Blinkit (quick-commerce segment)
- 🟥 34 crore loss from Hyperpure (grocery B2B segment)

Majority of the growth from now on is gonna be driven by the lower-frequency-users. The top 10% of users are power users - which means that they’re already maxmizing the benefit they get. The rest of the 90% irregular users are where the money is at.

Zomato’s monthly active transacting users increased 5% to 18.5 million - another important number.

Markets are giving lots of love to the stock price - shares are up over 150% since the start of the year with a market cap of over $12 billion.

Brilliant stuff… 🤔

BYJU’s has a “belligerent year”… 🤦

TLDR -
- BYJU’s core revenues grew 2X and EBITDA loss was trimmed by 7% (p. good)
- But they only reported numbers for their core business, and excluded all their acquisitions. This is odd, since they’ve never done that before.
- Plus, the founders told the world that they were targeting 10k Cr in FY22, but they missed by almost 64% (only 3.6k Cr)

Two years back, in VC-sponsored Disneyland, BYJU’s founder said that they’d hit over 10,000 Cr ($1.2bn+) in revenue for FY22.

So when they finally filed their FY22 financials last weekend (we are in FY24 right now 🙄), the numbers came out, and they read just 3,600 Cr ($430mn+)...

Overall revenue surged almost 2X from the year before, and total losses shrank by 7%.

That’s a very clear improvement in the business’s unit economics, but this isn’t the entire picture.

BYJU’s only reported the numbers of their CORE business. For every single year before that, they decided to go public with the full story - but for some reason, they’re only telling the world one side.

Truly a mess…

In other news… ☕

UAE’s emirates get in the race to build casinos (BBG)

Elon drops early access to his AI model - Grok (TC)

American asset managers press ahead with even more job cuts (FT)

Berkshire Hathaway post a 40% jump in earnings as cash pile crosses $157bn (CNBC)

Abu Dhabi & India mull over a $50 billion investment into the latter (BBG)

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