IPO – Dutch Uncles

Pepperfry’s IPO Launch – A Good Deal for Investors or Not?

Shalmoli Sarkar — Tue, 26 Oct 2021 08:36:24 +0000

Zomato’s launch of IPO in the Indian stock market, paved the path for several startups belonging to different business verticals to debut in it. There was an air of excitement in the Dalal Street since, the stock market this time welcomed an online food aggregator platform’s IPO launch, which was one of its kind.

Following Zomato’s suit, Pepperfry – an online furniture marketplace plans to file for an initial public offering (IPO) in June 2022, and complete the pre-IPO funding round by the end of this year.

Like many other businesses, the wrath of the subsequent lockdowns and pandemic was no stranger to Pepperfry. With most corporates adapting to a virtual workforce, it expected a bleak in its business but to its surprise, profits and sales began flowing with the recent virtual lifestyle making the furniture company inch closer to its IPO launch and unicorn dream.

The IPO dream and profitability in the pandemic

Any company to launch its IPO needs to give consistent profits. SEBI ( Securities and Exchange Board of India) expects companies to have a track record of profits distributed for three out of the immediately preceding five years.
The profitability of Pepperfry resulted due to an increased demand for chairs, laptop tables, study tables as the makeshift offices and schools at home began growing. Its chair sales grew by 250 percent y-o-y and study table sales grew by 400 percent in August 2020, thereby contributing 25 percent to its overall sales.

Also, the shift in consumer behaviour from offline to online purchases, resulted in Pepperfry’s online purchases locking profits upto 120 percent of pre-lockdown levels by Aug-Sept 2020. The online furniture marketplace also witnessed first-time buyers that were more in numbers than the repeat buyers from Tier-2 cities.

Besides furniture, consumers these days are spending a significant time indoors and are thereby demanding mattresses, cushions, and bean bags that deliver adequate comfort while resting, sleeping, and working. Catering to this new behaviour, Pepperfry launched its mattress brand Clouddio that began contributing around 35 percent to its overall business just after its 6-month launch.

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Pepperfry – an online furniture marketplace plans to file for an initial public offering (IPO) in June 2022, and complete the pre-IPO funding round by the end of this year.

The technology leverage and expansion plan of Pepperfry

Leveraging the AR and VR capabilities on its app and stores will be easing the shopping of furniture online for the new age customers by giving them an idea of how a product will look in their homes. After experiencing the products at the stores, customers can order online. Once customers can visualise the products using VR and benefit from it, will elevate their confidence in Pepperfry’s offerings thus driving its sales.
Moreover, Pepperfry is changing its approach to modular business by standardising the customer experience at its new modular centres in cities of Hyderabad, Bengaluru, and Mumbai, etc. The online furniture marketplace has plans to build 200 offline studios based on the FOFO model ( Franchise owned, franchise-operated) to penetrate into Tier-II and Tier-III cities in India.

Investing in Pepperfry’s IPO – a good deal for investors?

Whether investing in Pepperfry’s IPO will be lucrative or not is too early to say since the IPO is to be launched in June 2022. The company is largely focussing on growth and ramping up its offline presence by expanding its experiential stores in metros and smaller cities. The online furniture company registered a 26 percent increase in revenue to Rs 260.6 crore and has trimmed losses by 33 percent to Rs 122 crore in 2019-20. But, here investors need to take cognisance of the business vertical they are operating in.

Against the overall furniture sales that touched $700 million in 2019-20 the online furniture purchase had less than 3 percent share according to RedSeer Consulting. In addition to this, furniture purchase online is largely a metro consumer phenomenon and in India, it is largely an unorganised market, people yet like to purchase it from local carpenters. Although, Pepperfry has ambitious expansion plans to cover small Indian cities and can drive sales if hiring and employment increases since furniture is a non-essential category. There can be green shoots for the Pepperfry if offices again open up since India has now reached the 100 crore vaccination mark.

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IPO Fever Catching On? Top 6 Things to Keep in Mind

Shalmoli Sarkar — Mon, 18 Oct 2021 06:16:17 +0000

Dalal Street was filled with chatter and excitement when food delivery app Zomato announced launching its IPO on 23rd July 2021. On day one of its opening, Zomato’s performance was impressive whose shares opened at Rs 116 on the NSE and closed at Rs 125.30. The listing price on the Bombay Stock Exchange was at Rs 115, and closed at Rs 125.85, up by 65.59 percent from its issue price.

Zomato’s listing in the exchanges will lay the stone of encouragement to several startups that will be keen to raise funds from the public and offer an exit to existing PE or VC funds or existing shareholders and promoters.

When a reputed company announces its IPO, it creates hype in the market that draws more and more investors to purchase. But, behind this expectation of higher returns and peer’s recommendation investors invest in IPOs in a hurry that results in investing in companies with no accurate research and analysis, thereby incurring massive financial losses.

So, what are the questions investors should be asking before investing in IPOs, and how can investors avoid potential risks?

Let’s take a detailed look at things you should keep in mind before investing in IPOs.

Things to keep in mind before investing in an IPO

Understand the business: Before beginning to invest, one must understand the nature of the business the company is in. The next step after understanding the business will be now to recognise the company’s growth opportunities and its capacity to capture the market share. An investor should avoid investing in IPOs if the business activities lack the clarity to an investor.
Recognise the risk: Risks are inevitable while trading. Understanding the risk associated with the company is an important factor that should be considered. The current market scenario, its competitors, quality of products and services, liabilities including the contingent ones should be thoroughly analysed to decode any potential risks associated with the company. Such details are available from the company prospectus.
Financial Health of the company: The financial health of the company should be assessed with its revenues and profits being consistent over the past few years. If the revenues and profits are showing an upward trajectory, then it is a green signal for investment. One should also check the valuations, since offer price can be undervalued, fairly valued, or overvalued depending on the industry parameters and profitability ratios.
Always read the DRHP: DRHP (Draft Red Herring Prospectus) is filed by a company to SEBI when it intends to raise funds from the company by selling shares of the investors. The prospectus elaborates how the company intends to use the money that will be raised, and the possible risks for investors. Thus, investors must go through the DRHP before investing in an IPO.
Study the strength and weaknesses: Investors can figure out the key positives of the company from the DRHP. One should try to find the company’s position in the industry in which it operates, it is positioning, and strategies. By reading this, one can find more about the company’s prospects.
The utilisation of the proceeds: An investor needs to check that how the funds from the IPO raised will be used. If the purpose of utilising the funds is to repay the debts, then the investment is not lucrative. But, if the purpose is to repay the debts and expand the business or utilise it for general corporate purposes then it shows that the funds will flow into the business making it a good share to invest.

Final word for investors

For investing in stocks, mutual funds, or IPO companies, investors first need to understand their financial goals. A wise investor should not make haste in investment decisions based on the market hype, publicity, and peer recommendation of someone else. Investors should do their research. If one can see future growth and potential in the company, then one should consider investing in its IPO.

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Decoding Public Offering – Pre-IPO, IPO, Listing

Aakash Sharma — Mon, 06 Sep 2021 11:35:11 +0000

Today, companies view the public offering as one of the most effective ways to raise funds and plan an exit strategy. Established companies go public to raise large sums of money to fund their expansion plans, and start-ups that have built their brand to the limit see this as a good exit strategy.

However, a firm has to go through many nuances of the public offering process and numerous phases before going public. Let’s see what they are.

Pre-IPO (Pre-initial Public Offering)

Pre-IPO is a stage for a company when it puts shares up for private sale as a last measure to raise capital before it goes public. By introducing more funds, the private company adopts a matured outlook and prepares itself better for going public.

Pre-IPO shares can only be bought by professional investors, high net worth individuals, venture capitalists, private companies, and corporate insiders such as company founders and employees.

Investors invest in private companies a few months or one year before the IPO registration in the pre-IPO phase. This also means that the more significant risks are associated with pre-IPO transactions than with actual IPOs.

Moreover, it is not easy to objectively estimate the value of shares at the pre-IPO stage because a privately held company, unlike a public one, does not disclose financial statements.

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Companies in the pre-IPO stage are not required to provide investors with financial information or corporate rights.

Disadvantages of Pre-IPO over IPO

There are risks and downsides to investing in pre-IPO stocks that you should understand. As investors cannot access information about the company’s trades, including financial statements, pitch deck, or final business plans, they take a high risk of indulging in this investment stage. There is a lack of transparency and openness in the private market.

Initial Public Offering (IPO)

The Initial Public Offering (IPO) is a public issuance in which the shares of a company are sold to investors on a stock exchange. The IPO of a company is usually supported by one or more bank investors and a stock manager who arranges for the shares listed on stock exchanges. The process is commonly known as going public or floating. Following the IPO announcement, a private company becomes a public company.

With the IPO finalised, the company’s shares are issued and traded on the stock exchanges, also called the free market. While the offering offers several benefits, there are also significant costs, especially those related to the system, such as security, banking and legal fees.

Listing

A listing (of a company) refers to the company’s shares being on the list of legitimately traded stocks on a stock exchange. Usually, the issuing company is the one that applies for a listing. Company stocks whose market value and turnover fall below critical levels are often delisted by a stock exchange. Delisting can also result from a takeover or a merger of a company going private.

Each stock exchange has its requirements for a company’s listing, which include:

Annual financial reports for recent years,
Offering investor benefits at a fraction of the outstanding charges, and
An approved prospectus including opinions from independent assessors.

The Bombay Stock Exchange (BSE), for example, requires a minimum market capitalisation of Rs. 25 core and minimum public float equivalent to Rs. 10 crore for a company to be listed on it.

So, this is the basic know-how of the public offering process of companies. Before you start investing, start by analysing stocks and shares based on their IPO history and other financial proofs of stability.

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The Empress Of Beauty And Personal Care Nykaa Sets The Bar High

Anju Nambiar — Sat, 28 Aug 2021 05:35:07 +0000

Falguni Nayyar, India’s first woman entrepreneur who has led her company to the coveted unicorn status is now taking it to the IPO (initial public offering) stage. She has not just raised the bar for women entrepreneurs, but her company has set new benchmarks for India’s budding internet based beauty companies.

Falguni Nayyar’s Nykaa IPO

Falguni Nayyar’s Beauty Retailer Nykaa filed its IPO documents this month for a share towards the end of 2021. Nykaa is currently one of the most exciting IPO bound companies that could soon be valued at $4 Bn. The company has filed with the regulatory SEBI (Securities Exchange Board of India) and plans to offer up to 43 Mn shares worth $70.8 Mn

How Falguni Nayyar set the bar high for IPO-bound internet companies

Nykaa built an internet giant through a traditional yet unconventional e-retail model that’s now moving towards IPO. The first domestic unicorn backed by a woman founder to go for a public listing, Nykaa is the largest player among Indian internet companies in its segment. Despite being surrounded and dominated by global giants like Amazon and Sephora, Nykaa is India’s one-and-only niche player in e-commerce to go for IPO after declaring a profit.

How Nykaa quietly scaled up the personal care and beauty segment

Nykaa quietly scaled up in personal care and beauty while its big tech competitors like Amazon and Flipkart were looking the other way towards the fashion market. Nykaa reported a net profit for the financial year ending in March 2021. Whereas profitable businesses like Indiamart listed for IPO two decades after getting backed by venture capitalists and declaring a profit. However, Nykaa managed to reach the IPO stage by raising just $78 Mn of primary capital. On the other hand, sector-focused e-tailers like Lenskart and FirstCry raised hundreds of millions of dollars in primary capital. With just 78 Mill, Nykaa reached the same valuation as these companies and is now IPO-bound.

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The first domestic unicorn backed by a woman founder to go for a public listing, Nykaa is the largest player among Indian internet companies in its segment.

What’s in it for me?

Industry analysts have declared Nykaa’s IPO as a timely event, despite the pandemic. Nykaa’s success can be attributed to their strong segmentation of verticals for consumers by providing divisions within beauty. They attracted consumers with several different verticals they may be interested in like men’s, naturals, fashion, jewellery, etc. Also, their large and considerable inventory has been a profitable factor for them.

Nykaa’s inventory-based business model proved to be successful in the beauty space. The single biggest takeaway from Nykaa’s success for D2C and Internet companies is to focus on the core objective of the business. They mainly focused on the top 5 popular brands including Lakme and Maybelline which kept them on par with their competition, most of which were giants like Myntra, Amazon, and Sephora. Internet and D2C companies in the beauty sector must go for a definitive, authentic selection of make-up and beauty brands, through direct sourcing directly from the brand.

You also need to focus on an inventory led model along with providing stellar customer experience. Target the top 15 cities in India before rolling out to Tier II and III cities eventually. Other crucial pointers for start-ups and small businesses in this space would be to showcase exclusive ‘cult brands’ in beauty. Most importantly, invest on your technology as well as on retention and re-engagement strategy, just like Nykaa did.

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The 5 P’s Of Listing Process On BSE SME

Aakash Sharma — Thu, 12 Aug 2021 03:35:08 +0000

The BSE SME is a trading platform created by the Bombay Stock Exchange (BSE) that provides an investor-friendly environment in which small and medium-sized enterprises (SMEs) can be listed as trading companies. Through this platform, SMEs under the unorganised sectors across India can access regulated and organised sector benefits.

BSE SME offers enormous opportunities for the following market parties:

Entrepreneurs: It increases capital for the development and expansion of their SMEs in a cost-effective manner.

Investors: It allows investors to locate and invest in excellent companies in the early stages and on the way out.

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Small and medium-sized enterprises are the backbone of the national economy. SMEs in India employ 106 million people through 63 million companies, 40% of the Indian workforce.

Listing Process on BSE SME – the 5 P’s

Planning

The issuing company consults and appoints commercial bankers as advisors.

Preparation

Commercial banks prepare the documents to be submitted according to the following points:

Perform due diligence on the company, viewing all financial records, including related contracts, regulatory approvals, sponsor information, etc., and

Planning the Initial public offering (IPO) structure, equity issuance and financial needs.

Process

The application procedures include:

Draft Red Herring Prospectus (DHRP) Submission – These documents are prepared by commercial bankers and submitted to the exchange and Securities and Exchange Board of India (SEBI) upon request.

Verification and Site Visit – BSE verifies and processes documents. Exchange managers visit the company location. The organisers are invited to a meeting with the management advisory committee.

Approvals – The BSE issues in-principle approvals based on the committee’s recommendations, provided that the issuer meets all requirements.

Filing of RHP/Prospectus – Commercial Banks shall send these documents to the Registrar of Companies (ROC) stating the date of issue and the start date. After approval by the ROC, they shall provide information on the exchange date and the necessary documents.

Public Offering

The IPO is opened and closed as planned. After listing and trading, the company sends documents to the exchange to complete the sales base according to the checklist.

Pillar Listing

At the end of the allotment, the BSE issues a notification of the import transaction. After entering the BSE SME exchange, the existing exchange participants can participate in the SME platform and trade SME shares. However, trading on SME exchanges is limited by the size of the counterparties.

COVID crisis and the existential plea of Indian SMEs

During the COVID-19 crisis, the BSE-SME exchange halved to Rs. 1.5 crore, which is the net tangible asset requirement for SMEs planning to list on the platform. During the first COVID-19 wave, the Ministry of Finance changed the companies’ ability to be listed on the stock exchange.

Of the compulsory three years of operations, a company was eligible to list if it had combined positive cash accruals (earnings before depreciation and tax) in any one year under the new rules. Previously, they had to show money deposited for three years.

How can small businesses benefit from the BSE SME Exchange?

The damage to the financial cash flow from COVID is unprecedented and has resulted in dramatic changes in the SME sector. At a time when commercial banks were reluctant to lend due to concerns about NPAs, the relaxation in eligibility norms for SME listing enabled leveraged SMEs to explore the capital market and survive an economic downturn.

Using the BSE SME Exchange, SMEs can step into the threshold of the BSE SME Platform and foray into the world of finance for further growth and development. BSE SME helps these SMEs raise their own resources for growth and expansion, thereby helping them to become mature companies. It also enables them to take part in the Main Board of BSE under the applicable rules and regulations.

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Indian Edtech To See Foreign Capital Inflow As China Tightens Its Rules

Aakash Sharma — Tue, 03 Aug 2021 08:35:07 +0000

The Chinese government recently unveiled new rules for the country’s private education sector that prohibit after-school businesses, including education technology (edtech) companies, from making a profit, raising capital, or participating in IPOs.

Central government agencies have issued instructions to “reduce the burden on students enrolled in compulsory education”. The administration requires private teaching and coaching companies to re-register as non-profit organisations. The new rules prohibit authorities from approving new businesses and puts previously registered online education businesses under review.

Why does this move by the Chinese matter?

At a time when India is witnessing some of its biggest tech start-up IPOs, including Zomato’s recent listing and Nykaa’s upcoming IPO, the new Chinese regulations have ended the hopes for an IPO for the country’s biggest online education start-ups like Yuanfudao and Zuoyebang. These rules also limit fundraising for educational tech start-ups that are already listed publicly.

China has called for transforming its for-profit after-school educational institutions into non-profit educational technology institutions. It aims to prevent edtech start-ups from raising funds and going public.

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With the hopes of cashing in on this new development, Indian edtech companies are already hiring public policy executives to weigh options.

Indian edtech market and possible impacts on it

The education sector in India is highly controlled. Most of these laws and regulations apply to traditional educational institutions that offer education up to class 12th or higher. However, some states such as Telangana, Andhra Pradesh, Karnataka, Uttar Pradesh and Goa have recently begun to pass laws to regulate online education service providers and edtech companies. States like Maharashtra and Rajasthan also have formed committees to pass legislations concerning edtech.

As the Indian edtech sector continues to grow, governments may seek to regulate education technology platforms in specific ways for many reasons, but primarily to protect students’ rights.

The new Chinese laws certainly benefit India in the short term. The main reason for this is that venture capital financing has to go somewhere as it is deflected from the Chinese edtech sector. For this, India is a good and profitable opportunity in investors’ eyes. In the long run, however, the results of these events have no certainty.

India can anticipate more public-private collaborations in education in the coming days, similar to what Unacademy announced with the Government of Karnataka. Unacademy has signed a memorandum of understanding with the Karnataka government to offer free education to 4,500 students wishing to take the competitive exams. The three-year programme is part of the edtech giant’s corporate social responsibility (CSR) programme and offers tuition, scholarships and free Unacademy Plus membership through online testing to select qualified students.

What can India’s edtech players and new entrepreneurs take advantage of?

Considering that the fourth or fifth largest edtech firm in China is more extensive than BYJU’S (India’s biggest edtech player), the possibility for India to make the most of China’s policy disruption is immense. In the future, there will undoubtedly be much collaboration and cross partnerships between edtech companies, other industry segments and the government.

As edtech gets bigger and holds more weight to impact policy-based decisions, edtech start-ups will want to be in the government’s good books. These changes will further help attract a chunk of the foreign capital earmarked for China to India.

As scales gradually shift towards India via the massive demand, large talent pool and regulatory support from the government, edtech entrepreneurs are bound to benefit. It is high time for entrepreneurs and every stakeholder to put themselves out there and utilise the benefits that come with the capacity to submerge into the global stage as a free-market superpower, using education and technology as tools for success.

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Zomato is a Validation that India Can Generate Large IPOs

Anju Nambiar — Tue, 27 Jul 2021 03:35:08 +0000

Talks of Zomato’s IPO (Initial Public Offering) have been going around for quite a while. There was a lot of publicity, marketing and strategy involved in making the listing a grand affair. The Zomato IPO was strategically placed to create a significant buzz before going live. Apart from the heavy publicity, it had created quite the buzz among the investor fraternity since it was a large listing and the first of its kind.

Moreover, Zomato is a popular brand which is loved by Indian youth. Their efforts seem to have paid off as the IPO was a bumper affair and has made Zomato one of the 50 most valuable publicly traded firms in India.

Zomato went live on 23 July

Last week, Zomato put its IPO plan into action and went live with a bang. It is listed on the Indian Stock Exchanges at more than 50% premium than its issue price of INR 76. Zomato’s successful IPO listing has set a precedent for other Indian start-ups looking to follow in its wake.

Zomato kicked off their Initial Public Offering (IPO) at $1.3 B worth INR 93.75 B. While the listing was awaited with bated breath by the industry, it was also one of the biggest start-up IPOs of India this year. Zomato’s IPO received about 40 subscriptions and received bids worth 29.04 B equity shares. Evidently, it is a flagship listing among India’s tech unicorns.

Landmark achievement

The food aggregator’s IPO was celebrated with much fanfare in the history of IPOs. It was received with a healthy market demand. In just the first few hours after it went live, Zomato’s IPO was subscribed almost 100% by the retail investor segment. After this IPO concludes, Zomato is expected to be valued at $8B which will be a landmark achievement that’s relevant for the entire start-up fraternity and the food tech industry as well.

How entrepreneurs and investors watched

All eyes were on listing day as entrepreneurs and investors watched whether Zomato’s IPO would be a stellar debut or a flop. A number of brokerages had recommended subscription for Zomato’s IPO owing to long-term growth potential as well as the possibility of gains. Key stakeholders were awaiting reasonable gains. Bidders eagerly awaited the allotment date and twitter was flooded with celebratory messages from industry colleagues.

5 big Twitter celebratory messages

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Zomato’s IPO received about 40 subscriptions and received bids worth 29.04 B equity shares. Zomato’s is a flagship listing among India’s tech unicorns.

What this means to the industry

The Zomato IPO is good news for investors, VCs and start-ups since it will sharpen market demand including those coming from fellow start-ups as well as Venture Capitalists. Zomato’s IPO means more to the industry than just to the company itself. It has heralded a new era for Indian equity investors. It’s a major milestone for the private digital ecosystem. The company has now set sky high standards for the food delivery and technology industry.

Zomato IPO success – Validation that India can generate large IPOs

The success of Zomato’s IPO is concrete evidence of cross-section investor interest in internet companies. The Internet economy in India is horizontal with dynamic influence on most vertical industries right from D2C to logistics. The event will be the key to unlocking trapped value in multiple industries and entrepreneurs.

There’s a high possibility that in this decade alone, more than 100 internet/new-age unicorns will be listed. Following Zomato, more IPOs are sure to follow from a significant number of digital technology companies. This will boost entrepreneurship, give Start-up India a leg up, enable wealth creation and deepen our capital markets.

Zomato is currently growing exponentially across the country and its initial offering of $1.3 B means that they have reached the heights of success from where there’s no turning back. After the validation received from Zomato’s IPO’s massive success, 11 Indian start-ups are all set to take the IPO route by the end of 2021. Out of these 11 start-ups, 9 are unicorns including PayTM and Ola. These IPO bound start-ups have a bright future ahead, as investors are now willing to risk it up in Indian start-ups taking the cue from Zomato’s grand success. It has become a role model for Indian start-ups and has made the Indian capital markets open towards similar innovative business models.

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Its raining IPOs, What This Means for Google Cloud

DU Desk — Thu, 22 Jul 2021 08:35:12 +0000

Google is adamant on making it rain IPOs because of the billions of dollars in funding being pumped into the Indian start-up ecosystem. With big names like Zomato, PayTM, Mobikwik, PolicyBazaar, CarTrade and Nykaa headed for IPO at rapid speed, Google cannot afford to miss the chance at offering up their products and services to them.

Tech giants like Amazon, Facebook and Google have long been actively supporting start-ups in India, taking the cue from the Indian Government’s efforts to bolster the start-up community. Getting help from these tech giants is invaluable because your success rate shoots up. The technology stack and services from tech giants like Google are unparalleled. Start-ups shouldn’t miss the opportunity to apply for support programmes by these big tech firms.

Google Cloud’s interest for IPO bound start-ups

Google Cloud is interested in IPO bound start-ups and the Indian start-up ecosystem as a whole for two key reasons. One, the capital inflow into the ecosystem is set to touch a high of $19-$23 B by the end of 2021. Two, Google Cloud wants to further bolster the growth of these already-growing start-ups by empowering them with cutting-edge Cloud technology.

Google Cloud is providing specially designed programmes for start-ups across various growth stages as well as for unicorns and IPO-bound start-ups. Through these programmes, they are providing training, zero credits, mentoring sessions and giving them the opportunity to work with specialists. As start-ups grow and progress towards becoming unicorns, Google Cloud helps tackle their larger problems by making them shift from providing an engagement model to offering solutions.

How Google Cloud is empowering start-ups and unicorns

Google Cloud is empowering start-ups and unicorns in India by helping them grow the number of monthly active users on their platform. By leveraging Google’s Cloud technology, these start-ups and unicorns are being empowered to achieve key milestones along their growth trajectory.

Prominent start-ups using Google Cloud infrastructure

Well-known start-ups and unicorns in India using Google Cloud’s infrastructure include Glance (Artificial Intelligence (AI) – based software company), ShareChat (consumer tech unicorn), Rapido (automobile start-up) and Dailyhunt (consumer tech).

How Google Cloud works with start-ups

Google Cloud works with start-ups by first offering them with cloud solutions and then giving them access to ‘ALL of Google’. What this means is that the start-up will grow with Google. The start-up’s products will also be added to Google Maps. Google will also help with Google Ads integration.

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As start-ups grow and progress towards becoming unicorns, Google Cloud helps tackle their larger problems by making them shift from providing an engagement model to offering solutions.

What’s in it for me?

Google has a number of start-up programmes which are very easy to apply and get approval for. Products and services by the tech giants are all start-ups need to propel them forward since Google’s offerings are very powerful and robust. Migrating to the Google Cloud is very beneficial for start-ups in various growth stages because you not only enjoy tools and resources provided by Google, but you also get support to fix issues along your start-up journey.

Google is also offering their Startups Accelerator Program (GSFA) through which you can get nurtured for a period of three months with free mentorship and support. It is designed for growth and early-stage start-ups. The leadership training from Google experts that you can avail through this programme will prove to be invaluable in later stages. In this programme, you stand to gain equity-free support, training and credits which you can use to purchase premium Google cloud and other products.

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Burger King, The Bull

DU Desk — Thu, 22 Jul 2021 05:35:07 +0000

On 19th July 2021, the share price of Quick Service Restaurant (QSR) chain Burger King India gained 5 percent to Rs 177 apiece on BSE even as BSE Sensex and Nifty 50 went red. The share of Burger King has increased by 12.16 percent over the month where a total of 2.93 million shares changed hands that resulted in a turnover of Rs 5.12 crore and ballooned its market capitalisation to Rs 6673 crore on the BSE. Burger King’s shares, with a previous close of Rs 168.50, opened at Rs 168.

Burger King’s Growth Trajectory in Market

Burger King’s performance in the stock market has been stellar since its debut in December 2020, where its initial stocks were listed at Rs 115.35, against an issue price of Rs 60 on the BSE. While on the NSE it made its debut opening at Rs 112.50, an 87.50 percent premium over IPO price. Since then the stocks have soared over 63 percent while zooming a huge 195 percent from the IPO price of Rs 60 piece.

Current Market Stock Price of Burger King: As of 20th July 2021, Burger King’s stocks opened at Rs 179.9 and closed at Rs 178.25.

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On 19th July 2021, the share price of QSR chain Burger King India gained 5 percent to Rs 177 apiece on BSE even as BSE Sensex and Nifty 50 went red.

Burger King attracting investments to become a Bull, But Why?

The QSR food industry is dominated by three players: Jubilant Foodworks, Westlife Development and Burger King. Out of which Burger King’s network expansion is at a faster pace than the two. Its ambitious plans of opening 700 stores by December 2025 speak volumes about its potential to expand and improve its profitability. With their strong marketing strategies, they have established a loyal customer base. It is making a big shift in its business model by introducing Burger King Café and barbell product strategy i.e. investing in the two extremes of high-risk and no-risk assets.

Moreover, Burger King has achieved a royalty rate of 5 percent until 2039 unlike Jubilant and Westlife whose royalty rates are 3 and 4 percent respectively. A royalty rate is an amount paid by a third party to the owner of a product or patent for the use of that product or patent. Royalty investments showcase a steady income and are considered less risky than traditional stocks which is why it is an interesting investment opportunity for the investors in the market.

What are analysts saying about Burger King?

Market analysts are affirmative about investing in Burger King. They are suggesting that both short-term and long-term investors are going to benefit by investing in it. The long-term investors are advised to stay invested in the company since there is ample scope available for Burger King to increase its business in India and gain market share by opening more stores than its competitor.

The QSR Industry is Luring Investors Recently

The QSRs have gained a major market foothold in a short period and have been luring investors in the pandemic. Despite the QSR sales taking a dip in the pandemic, a report from Kotak Institutional suggests that India’s organized food services market is expected to grow at about 10.5 percent CAGR to $37 billion in 2020-2025. Within that, the QSRs have a potential growing at 13 percent CAGR amounting to $9.5 billion.

Lack of funds and revenues are closing many unorganised restaurants that are likely to benefit the QSRs. Food aggregator apps have lowered the slashed food prices and with the commission payment, the restaurants are finding it difficult to sustain. QSRs, on the other hand, have strong access to capital that will help them bolster store expansion plans and expand their footprint in the home delivery market.

To maximise profits and return ratios, the QSRs are closing down the non-performing stores and introducing delivery fees to bridge the price gaps between in-store and online menus

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AI Start-up Fractal Growth Strategy Predicts Revenue Growth in 2022

Anju Nambiar — Sat, 17 Jul 2021 03:34:39 +0000

Big Data rules the world and in the initial days when it was emerging as the giant of IT (Information Technology), companies that tapped into the market grew in leaps and bounds. Fractal.ai is one such company which has achieved tremendous growth over the years. Along their journey, they’ve checked a number of boxes which has made them the market leaders of the Analytics-as-a-Service space.

Fractal.ai and its IPO listing

Fractal.ai is an AI (Artificial Intelligence) company with Fortune 100 companies across the world as its clients. They are an Analytics Solution provider and a strong player in the AI space. They are confident that an Initial Public Offering (IPO) will further add to their growth story and will soon be listing publicly. Fractal is expecting a revenue growth of 37% touching $160 M in the Financial year ending March 2022.

Fractal’s growth strategy

Fractal’s growth story has been fuelled by acquisitions and funding. They ventured into analytics at a crucial juncture when it was being prioritised by organisations for their digital transformation.

Fundraising

The company raised funds and achieved a valuation of 12 times than its global revenue back in 2016 (INR 350 Cr). They redirected this money strategically. They invested the new funds into new markets, employed data professionals and poured money into building their data platforms.

Incubation of other AI projects

Also, a part of their growth strategy are Fractal’s strategic acquisitions of other AI projects like Qure.ai, Theremin.ai, Equgenie.ai and more recently Samya.ai. The acquisition of Samya.ai will further strengthen Fractal’s offerings and expand its reach across industries and increase their global footprint.

A few years ago, they went on an acquisition spree where they acquired start-ups for the sole purpose of building their Natural Language Processing and Deep Learning capabilities. They acquired companies like Imagna Analytics and Mobius Innovations. These acquisitions strengthened Fractal’s technology offering which naturally contributed to its growth.

The Pandemic has been a turning point for Fractal

The start-up has witnessed a business expansion with the outbreak of the pandemic. The pandemic period has boosted the demand for their services. Enterprises have been forced to move their functions and operations to the cloud.

A brand-new Initiative – Crux Intelligence

Their new initiative ‘Crux Intelligence’ is also a part of their upcoming growth strategy. Crux is a solution that offers business intelligence to enterprises and even converts the data intelligence into actionable insights.

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The acquisition of Samya.ai will further strengthen Fractal’s offerings and expand its reach across industries and increase their global footprint.

What’s in it for me?

AI start-ups are continuing to raise funds. In 2020, the AI start-up community collectively raised $836.3 M in funding. Real-time AI and Deep Learning platforms have wide use cases and a variety of applications for ‘smart and intelligent’ projects across a multitude of sectors like automobile manufacturing, robotics and transportation.

Data driven SaaS solutions powered by Machine Learning and AI have immense applications in Enterprise Tech. Nascent industries like Manufacturing and Insurance need business and data intelligence AI solutions. These are the industries you can disrupt as a start-up.

While venturing into the AI space, you need to find the perfect ‘product-market’ fit. This is both crucial and a difficult step for Enterprise Tech start-ups. Irrespective of the industry you are targeting, every enterprise in the target market is unique. Your AI solution must be custom tailored to their requirements. To achieve this level of customisation, your tech team must be strong. Thus, you need to invest in hiring data scientists, engineers and technologists. Investor interest around AI and data intelligence is for start-ups that are building customised AI solutions for previously unsolvable problems.

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