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Also in today’s edition: Omicron wrecks plans, Zee-Sony are a pair, Whose Internet will it be? India planning coal taper
Good Morning! India’s most famous bull, Rakesh Jhunjhunwala, met the bear again. Metro Brands, backed by him, opened at a discount, underwhelming investors. This is not the first time his companies had to tolerate a bear hug. Star Health disappointed on debut and gaming company Nazara hit a lower circuit on the day it IPOed.
Btw, our podcast has been going strong for two months now. Tune in on your daily jog, drive to the office, or even as you WFH-ers have breakfast in bed. We promise it’ll be music to your ears.
The Market Signal
Stocks: Major indices remained in the green during trading as investors continued to buy stocks. After the fall last week, many investors are seeing value in dips. Despite the uncertainty that Omicron has brought, no one wants to lose out should the market rally like it did last year.
Omicron Crashes Year-End Plans
With the rapid spread of the Omicron variant of the coronavirus, big-ticket fixtures are getting cancelled or postponed. The Delhi government has banned all Christmas and New Year celebrations. Not just entertainment and sports, major tech events and economic forums the world over are also fizzling out.
Uncertainty prevails: Consumer Electronics Show in Las Vegas is the latest victim. Big names such as Meta, Twitter, Pinterest and JPMorgan have already bailed out. The event that drew over 100,000 visitors at its previous full-scale edition will have a tough time with journalists giving it a miss too.
The annual gathering of top business and political leaders at the World Economic Forum in Davos has also been postponed. In fact, you might even want to reconsider your holiday plans, as the risk of catching Covid-19 could be double aboard aircraft.
But like the WHO head Tedros Adhanom Ghebreyesus said, "an event cancelled is better than a life cancelled”.
More the better: With Omicron becoming the dominant variant in many countries, global leaders are pushing for the third dose or the booster shot of Covid-19 vaccine. Israel is going one step ahead and planning to roll out a fourth dose.
Subhash Chandra Gets His Way
The Zee-Sony merger appears to be through, creating India’s second biggest media company and offering its promoter Subhash Chandra an opportunity to claw back his lost empire. Chandra’s family can hold upto 3.99% stake in the merged entity with an option to raise it to 20% via the open market.
Invesco troubles: Zee and Invesco, which holds 17.88% stake, have been engaged in a corporate tussle for months. The investor wants to oust the company’s CEO Punit Goenka. The dispute is now before the National Company Law Tribunal.
What’s next? Zee had suitors such as the Reliance group courting it in the past, a deal Invesco favoured. Meanwhile, Chandra’s dream of having a family seat in the company is also fulfilled with Punit’s approval as CEO.
Jack Is A Chip Off The Old Block
Jack Dorsey’s having a ball irking Web3 evangelists on the platform he co-founded. What started as a tweet questioning the rose-tinted loftiness of Web3 is now grounds for a legitimate debate. But not before Dorsey and Elon Musk threw shade at venture capitalists (VCs).
Say what? Web3 is the upcoming iteration of an Internet that will run on blockchain technology. Think cryptocurrency, digital assets, and decentralised architecture replacing the walled gardens of Big Tech in Web 2.0. The idea is to subvert the data-driven models of Meta, Google, Amazon, etc. (ironically, even Twitter) and return power to the people.
So what’s the problem?: The early movers in Web3 and a subsequent metaverse are the very people who shaped Web 2.0. Take a16z—the VC fund Musk and Dorsey alluded to—as an example. Its founders didn't just invest in Twitter, Meta (then Facebook), and a problem named Clubhouse; they also have stakes in the crypto exchange Coinbase, NFT platform OpenSea, and metaverse-frontrunner Roblox. In short, those incentivised to make money will control what is supposed to be of the people, by the people.
Jack Dorsey isn’t just CEO of digital payments company Block (formerly Square). He’s also part of the Bluesky protocol to create a decentralised standard for social media and has skin in the game. But he’s a Bitcoin loyalist who believes the original cryptocurrency is the only one with an anti-establishment ethos, considering other currencies attracted $6.5 billion in VC money in Q3 2021.
Dorsey isn’t wrong about grubby VC hands in the Web3 pot. That said, he’s naive about Bitcoin in the same way others are about Web3; after all, just 0.01% of Bitcoin holders control 27% of its circulation.
India may switch off coal-fired power plants
India may not set up any more coal-fired power plants. An expert panel of the power ministry has recommended that inefficient generating stations be retired by as early as 2023.
U-turn: India has an installed coal-based generation capacity of 209 gigawatts. The panel’s recommendation is a surprising turn away from what policymakers were thinking at the beginning of 2021. Home minister Amit Shah had said that coal was the centrepiece of India’s strategy to become a $5 trillion economy.
Net zero: India pledged at the November COP 26 summit to become carbon neutral by 2070, a promise difficult to redeem without reducing dependence on fossil fuels. Indian companies would also need a huge amount of capital and technology to make the transition.
Meanwhile, three sovereign funds reportedly want a slice of Reliance Industries’ green energy division.
Work Week Is Shrinking But Not The Hours
India doesn’t have as many million-dollar CEOs and CXOs this year. The number has shrunk from 150 last year to 125 today. This is despite average salaries shooting up by over 21% to ₹20.4 crore in 2021 from ₹16.8 crore the previous year. A weakening rupee against the dollar is the prime reason the elite club is losing members.
Put in the hours: India is said to have the longest work week among major economies, but that could change. New labour laws are set to transform the work culture in the country, altering pay packages and reducing the work week to four days. But the workday could stretch up to 12 hours.
Bad press: Urban Company (UC) has gone to court to stop its women gig workers from protesting against its new policies that the beauticians say impact their earnings. UC is calling the strike “illegal”. This is the first time an Indian tech company is taking on protesting workers.
What Else Made The Signal?
Tough love: After Google, chip-maker Intel is following suit. Employees are expected to get the jab or give a reason for exemption by January 4, 2022. If not, they will be placed on unpaid leave.
Safety concerns: Top executives at Airbus and Boeing have urged the Biden administration to put a pause on 5G services in the country, raising fears that roll-out could interfere with aviation safety.
Ocean to Land: World’s largest container shipping line, Maersk plans to buy Hong Kong-based Li & Fung’s contract logistics business for $3.6 billion to expand its land-based operations.
Wobbling slide: Chinese tech cos Tencent Holdings and Alibaba Group Holding have fallen out from the global top-10 list in terms of market capitalisation.
Growing business: Online recruitment firm Monster.com raised ₹137.5 crore in the latest funding round, taking the company’s valuation close to $100 million.
Made in India: Apple started the trial production of iPhone 13 in India at the Chennai-based Foxconn plant.
Betting big: Gurugram-based CityMall is the latest platform to set its sights on the fresh grocery market.
Jurassic baby: This has all the trappings of a blockbuster. Scientists have discovered a rare, "perfectly preserved" fossil of a baby dinosaur. Believed to be at least 66 million years old, it was discovered in Ganzhou, China. Dubbed Baby Yingliang, this may help researchers find the link between dinosaurs and modern-day birds.
Golden text: It is a merry Christmas indeed for Vodafone. An NFT of the first text message ever sent, “Merry Christmas” was sold for $121,00 in Paris. Selling “intangible goods” is illegal in France, so the auction house framed the text message in a digital frame.
Christie’s catches up: When you can't beat them, join them. Christie's played to the gallery with NFT and won the round. The 255-year-old auction house has drawn $150 million purely from NFT. This makes up for 8% of Christie’s contemporary art sales.
We, at The Signal and The Intersection, will be taking a year-end break beginning Friday. There will be no regular editions but we will bring you a curated snapshot of 2021 every day.
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