Namaste, Sat Sri Akaal, and Salaam. 🫡

Happy Friday, folks. 🙏

Today we’re diving into -
- Reliance’s latest rights purchase + Disney war,
- Mamaearth’s targeted November IPO,
- And Uniqlo’s staggering 3-year success in India.

Our read time today is 4 minutes and 48 seconds - faster than you can finish a plate of Monika ke chole bhature. 🔥

Let's dive in. 👇

Market Vibe Check

Reliance bleeds Disney dry with ISL rights. ⚽

TLDR -
- Reliance just bought ISL rights for $67 million.
- They will probably end up making a loss on this, but what matters is that NO ONE ELSE can stream it.
- Their biggest competitor Disney is on track to lose over $400mn in top-line and 20+ million subs this year.

Earlier this year, Disney was trying to sell it’s India business.

Mukesh Ambani and Reliance have given them another reason to do so.

Reliance just bought rights to ISL for the next 2 years - India’s biggest football league.

This isn’t gonna make Reliance any money, but it COMPLETELY blocks out their competitors from streaming any popular sports leagues.

They also snatched IPL streaming rights from under Disney’s nose for $2.7 billion, which led to Disney losing over 15 million subscribers over 2 quarters (since a LOT of people paid just to watch IPL).

Now couple this with the fact that -
- Disney makes 365.5 INR/month from an American user
- But only 48.6 INR/month from an Indian user

And you can quickly see how their struggles are compounding.

- can’t stream any major sports leagues
- can’t invest big bucks into homegrown content
- can’t negotiate with foreign film houses to host their titles

Disney’s India business is expected to see a drop of $400 million in top-line sales this year, with a staggering 50% drop in earnings.

Streaming wars! ��️

Uniqlo’s India business roars to record profits in organized retail. 👔

TLDR -
- Uniqlo clocked 630Cr ($76m) of topline and 68Cr ($7.2m) of profit in India.
- They’re not targeting the fast-fashion segment, they’re going for a PREMIUM customer who wants to wear quality clothes.
- Despite that, they’re growing revenues at 70%+ - India’s market really is super diverse.

Uniqlo launched their first India store in 2019.

Cut to today, and they’re a profitable business that’s growing at 70% a year.

They did almost 630Cr ($76mn) of sales in the last 12 months with a pretty stunning profit margin of 11%.

The even crazier part - they’ve done it all from 10 brick and mortar stores.

What interests me about their business is that they are not targeting the “fast fashion” segment like H&M and Zara do.

Uniqlo is not selling cheap and flimsy clothes that look good but only for 3 washes.

Uniqlo is selling genuinely premium products, and Indian consumers are LOVING it.

People are willing to pay big bucks for a product that’s miles above what anyone else can offer.

Uniqlo proves it - if you can sell a 5000 rupee jacket in India AT SCALE, you have made it as a brand.

Seedha Japan se le kar… India tak. 🚀

Mamaearth hunts for a $1.5 billion blockbuster IPO. 🌎

TLDR -
- Mamaearth investors are gonna offload big stakes in a November IPO.
- The target valuation is in between $1.4 to $1.6 billion.
- Founders want to consciously underprice the IPO so that retail can buy in - but big-name investors won’t love it.

Earlier this year, Mamaearth filed their documents to go public on the stock markets.

But it was at a 1000X+ profit multiple.

Mamearth’s investors realised that if a company went public at a price that inflated, it would come crashing down.

So this time around, they’re trying to consciously underprice their offering so that there is still upside on the table for retail investors.

Most liquidity will come from existing investors - which means that there will be less money for business expansion, and more for profit-locking in from the early investors.

In other news… ☕

Goldman gets ready to cull their employee pool (BBG)

British neobank Zopa crosses the 1m users mark with a $93mn fundraise (TC)

Apple loses $200bn in value after China issues (FT)

ChatGPT traffic declines for 3rd month in a row (Mint)

FTX exec Ryan Salame pleads guilty and hands over $1.5 billion (CNBC)

And that’s the tea the chai for today.

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

Lots of ❤️,

Team Cutting Chai