🇧🇷 Brazil shuts down X

Good morning. Sumit Antil won gold for India in the Paralympics with his record breaking javelin throw of 70.59m.

For context, an Olympic-sized swimming pool is 50m long. Therefore, 70.59m is approximately 1.41 times the length of such a pool. Unreal 🔥 🇮🇳

- Ruchirr Sharma & Shatakshi Sharmaa

TABLE OF CONTENTS

• 👓️ New-age consumer brands are all the rage

• 🇧🇷 Brazil shuts down X

• 🗞️ Bite-sized summaries

  • 🚗 Drop in car demand

  • 📈 Increase in discretionary banking spending

• 🧑‍🍳 What else is cookin’?

• 🍿 Entertainment, Entertainment, Entertainment

MARKETS

🇮🇳 India

• Benchmark equity indices reached record highs, with the BSE Sensex closing at 82,559.84 and the Nifty50 at 25,278.70. Gains were led by Bajaj Finserv, Bajaj Finance, and HCL Tech, while NTPC and Tata Motors lagged. Broader indices showed mixed results, with IT and Banking sectors performing well, while Metals and Pharma declined.

🌍️ International

VENTURE CAPITAL

👓️ New-age consumer brands are all the rage

The D2C market in India is projected to grow significantly, with expectations of reaching $100B by 2025, driven by factors such as increased internet penetration and changing consumer behaviour.

These numbers follow a growing trend, where Indian VCs are increasingly backing consumer brands that leverage technology and innovative business models to capture the evolving preferences of Indian consumers. 

Brands like the five-year-old luggage maker Mokobara, clothing label Snitch, and established players such as Sugar Cosmetics and Boat resonate with younger consumers by offering more premium, tailored products, successfully addressing market gaps that traditional companies have overlooked. 

In 2024 alone, over $400M has been invested in these emerging companies, contributing to more than $5B since 2014.

So what’s working for these brands? 

• These direct-to-consumer brands have gained traction by offering premium products that meet the specific demands of a more discerning consumer base. 

• V S Kannan Sitaram, co-founder of Fireside Ventures, highlights that today's consumers are seeking products that go beyond the average, with a significant number willing to pay extra for quality. 

• Fireside Ventures recently backed Moxie Beauty, a Gurgaon-based company that produces haircare products tailored for Indian conditions—a niche that global brands have largely missed.

• Other brands, such as Sid's Farm, Foxtale, and Bummer, have also secured funding this year, with Accel leading a $9M round for Uppercase, a luggage brand. 

Overall: Analysts from Bain & Company describe these "insurgent" brands as those growing faster than their categories, driven by the rise in India's income and consumption. 

Hariharan Premkumar of DSG Consumer Partners notes that premiumization and the creation of new categories are key drivers of this growth, potentially accounting for 50% of overall consumption expansion by 2030.

The increasing popularity of quick commerce platforms further accelerates these brands' reach, enabling them to connect with consumers more swiftly and fuelling their continued growth. India's dynamic consumer market is proving fertile ground for these new-age brands, positioning them for sustained success in the years to come.

Read more: Economic Times

SOCIAL MEDIA

🇧🇷 Brazil shuts down X

In a dramatic turn of events, Elon Musk's social media platform X has been suspended in Brazil after a months-long feud between the billionaire and Supreme Court Judge Alexandre de Moraes.

Here’s what happened: 

• The conflict began when Moraes ordered the suspension of X accounts belonging to supporters of Brazil's former far-right president Jair Bolsonaro. This included figures like ex-congressman Daniel Silveira, who was sentenced to nine years in prison for leading a movement to overthrow the Supreme Court.

• Bolsonaro had attempted to discredit the country's voting system, which he lost to current President Luiz Inacio Lula da Silva. The government is now investigating whether Bolsonaro plotted a coup to prevent Lula from taking office in January 2023.

• In April, Moraes ordered an investigation into Musk, accusing him of reactivating some of the banned accounts on X. 

• Musk, in turn, has accused Moraes of stifling free speech and has missed a judge's deadline to appoint a legal representative in the country.

Disinformation has been at the heart of this feud. 

• Brazil struggled with the issue during the 2022 elections, leading the top court to grant Moraes sweeping powers to order social networks to remove content he believed threatened democracy. 

• Since then, Moraes has aggressively attempted to clean up Brazil's internet, forcing platforms to remove thousands of posts.

Musk launched a campaign against Moraes on X, calling for the justice to be impeached and accusing him of violating the Brazilian constitution. The Tesla and SpaceX CEO has also stated that the platform does not seek to impose the laws of the United States on other countries but rather obeys the laws of the country in which it operates.

Looking ahead: A five-member panel of the Supreme Court is expected to vote on Monday on whether to uphold Moraes' ruling to shut down X in the country. In the meantime, Brazilians have been flocking to Bluesky, a social media platform launched by Twitter founder Jack Dorsey, as they navigate the X ban.

Read more: Economic Times

GENERAL OVERVIEW

🗞️ Bite-sized summaries

🚗 Drop in car demand - Maruti Suzuki, Hyundai, and Tata Motors have reduced wholesale deliveries to dealerships due to lower consumer demand, leading to inventory buildup. Maruti's domestic passenger vehicle wholesales in August dropped by 8%, while Hyundai and Tata Motors also reported declines. In contrast, Kia and Toyota increased dealer supplies, with Kia reporting a 17% rise in August. Maruti cited inventory reduction as the reason for the cutback, with dealer stock levels slightly decreasing. The industry is adjusting inventories and strategies as it prepares for the festive season, starting with Ganesh Chaturthi.

📈 Increase in discretionary banking spending - HCLTech and Wipro, two of India’s top IT companies, are experiencing an increase in discretionary spending in the banking, financial services, and insurance (BFSI) sector, surprising the industry. This uptick contrasts with other sectors, which remain focused on cost optimization. Analysts expect this trend to expand in the next two quarters, driven by anticipated rate cuts. Wipro's consulting arm, Capco, also saw growth in BFSI-related discretionary spends. Experts are cautiously optimistic, noting the potential for broader growth in discretionary spending across various sectors by early next year.

HEADLINES

🧑‍🍳 What else is cookin’?

What’s happening in India (and around the world 🌍️)

• Yatra acquires Globe Travels for ₹128 Cr. in cash.

• India considering Sovereign Wealth Fund, govt in talks with RBI and SEBI.

• Adani Green approves pacts for $444M TotalEnergies JV investment.

• Tata Motors eyes gains in SUV space; expands portfolio with new model Curvv.

• Cabinet gives go ahead for ₹3,300 Cr. semiconductor unit in Gujarat; India's fifth.

• France's Atos cuts financial targets but says restructuring still on track.
  

CULTURE

🍿 Entertainment, Entertainment, Entertainment

• Sumit Antil becomes first Indian man to defend title at Paralympics Paris 2024. Scoreboard here.

• US Open 2024: Navarro beats Guaff 6-3, 4-6, 6-3. to All latest updates here.