🛵 It’s finally happening

Good morning. Yesterday, McDonald's shares took a hit following a serious E. coli outbreak linked to their popular Quarter Pounder burgers.

We have covered McD in our opening 2 days in a row. If you missed it yesterday, scroll down below to get more coverage and also subscribe to the newsletter while you are at it - so you don’t miss any critical news like those involving your go-to fast food chains🍔 😅 

- Ruchirr Sharma & Shatakshi Sharmaa  

TABLE OF CONTENTS

• 🛵 It’s finally happening

• 🎭️ Facial recognition

• 🗞️ Bite-sized summaries

  • 🔍️ Another AI lawsuit

  • 🍔 McD does not endorse Trump

• 🧑‍🍳 What else is cookin’?

• 🍿 Entertainment, Entertainment, Entertainment

MARKETS

🇮🇳 India

• Stocks faced significant downturn on Tuesday. Key factors included profit booking by investors, record selling by foreign institutional investors (FIIs), and bearish global sentiment. This volatility wiped out over Rs 9 lakh Cr. in market capitalisation, raising concerns about future market stability.

🌍️ International

• Stocks ended mostly flat, with the Nasdaq gaining slightly while the Dow and S&P 500 dipped. Investors focused on rising Treasury yields and upcoming earnings reports. Verizon and GE Aerospace reported disappointing results, while General Motors exceeded expectations. Market volatility is expected to persist as investors assess economic indicators and the impact of potential Federal Reserve rate cuts.

BOLLYWOOD

🛵 It’s finally happening

In a significant development, Zomato has announced its intention to raise ₹8,500 Cr. (approximately $1B) through a qualified institutional placement (QIP). This fundraising marks Zomato's first major financial manoeuvre since its initial public offering (IPO) in July 2021. The decision comes at a time when the competitive landscape in the food delivery and quick commerce sectors is intensifying, particularly with rivals like Swiggy and Zepto ramping up their operations and funding.

But why now?

• Zomato's CEO, Deepinder Goyal, emphasized the need for enhanced cash reserves to navigate the current competitive climate.

• In a letter to shareholders, he noted that while the company is now generating cash—contrasting its previous loss-making status at the IPO—there is a pressing need to bolster its financial position. Goyal stated, "We believe that capital by itself does not give anyone the right to win... but we want to ensure that we are on a level playing field with our competitors" who are also actively raising funds.

• This strategic move is essential as Zomato faces fierce competition from Swiggy, which is preparing for a $1.25B IPO, and Zepto, which has raised over $1B recently due to heightened investor interest in rapid delivery services. The competitive pressure has led to increased cash burn rates within the quick commerce sector, prompting Zomato to act decisively to secure its market position.

Financial context and future implications:

• Zomato's recent acquisition of Paytm's events and ticketing business for ₹2,014 Cr. has impacted its cash reserves, which stood at ₹10,813 Cr. as of September 30. This acquisition reflects Zomato's strategy to diversify its offerings beyond food delivery into related sectors.

• The upcoming QIP will not only provide Zomato with the necessary capital but could also influence the broader quick commerce industry dynamics. As companies like Zomato and Swiggy continue to invest heavily in their operations and technology, the industry may see an escalation in spending and innovation aimed at capturing market share.

Overall: Zomato's decision to raise funds through QIP underscores its commitment to remaining competitive in a rapidly evolving market. As the food delivery landscape grows more complex with new entrants and increased consumer demand for quick commerce solutions, Zomato's proactive approach may be crucial for sustaining its growth trajectory.

Read more: Economic Times

META

🎭️ Facial recognition

In a proactive move to enhance user security, Meta is currently testing a new facial recognition feature aimed at preventing the misuse of images and videos of public figures on its platforms, including Facebook and Instagram. This initiative comes in response to the growing concern over scams and impersonation that have become prevalent in the digital landscape.

Purpose and functionality of the new feature:

• David Agranovich, Meta's Director of Security Policy, highlighted that the primary goal of this technology is to combat fraud and scams, which he identified as critical security challenges.

• The feature operates on a pilot basis and is designed to track advertisements that use the likenesses of public figures. If an advertisement is flagged as a scam and matches a recognized face, it will be blocked from appearing to users.

• Meta has emphasized its commitment to user privacy by stating that any facial data generated during this process will be deleted immediately after a one-time comparison.

• This ensures that the data is not stored or used for any other purposes, addressing potential concerns about privacy violations associated with facial recognition technologies.

Additional security measures:

• Beyond tackling scams, Meta is also exploring the use of video selfies for identity verification. Users will be able to upload a video selfie, which will then be compared against their profile pictures to verify their identity when attempting to regain access to compromised accounts.

• This method mirrors existing biometric security features found in smartphones and other applications.

• The introduction of these features reflects Meta's ongoing efforts to bolster security measures across its platforms amid increasing scrutiny over user safety and privacy.

• As digital scams evolve, companies like Meta are under pressure to innovate and protect their users effectively.

When analysing broader industry implications, the implementation of facial recognition technology raises important questions about privacy, ethics, and regulation in the tech industry. While such advancements can enhance security, they also necessitate robust discussions around consent and data protection.

As Meta navigates these complexities, its approach could set precedents for how other social media platforms address similar challenges.

Overall: Meta's testing of facial recognition technology represents a significant step towards enhancing user safety against scams and fraud in an increasingly digital world. By prioritising user privacy while implementing innovative security measures, Meta aims to create a safer online environment for its users.

Read more: Economic Times

GENERAL OVERVIEW

🗞️ Bite-sized summaries

🔍️ Another AI lawsuit - Dow Jones and the New York Post have filed a lawsuit against AI startup Perplexity, accusing it of copyright infringement. The lawsuit alleges that Perplexity illegally copies content from publishers like the Wall Street Journal and diverts revenue from original sources by allowing users to "skip the links" to publishers' websites. News Corp CEO Robert Thomson condemned the startup for exploiting intellectual property without compensation. This lawsuit follows a cease-and-desist notice from the New York Times and comes as Perplexity seeks to raise $500M in new funding, valuing the company at $8B.

🍔 McD does not endorse Trump - McDonald’s hosted former President Donald Trump at a Pennsylvania store over the weekend, where he worked briefly at the fry station and took drive-thru orders. Despite facilitating the event, the company clarified that it is not endorsing any presidential candidate. McDonald’s emphasised its commitment to welcoming everyone and noted that franchisees have also invited Democratic candidates Kamala Harris and Gov. Tim Walz. The event sparked a brief social media backlash, with calls to boycott McDonald’s. However, experts believe the company won't suffer long-term damage, as the publicity likely outweighs any negative reaction. McDonald’s maintains neutrality in political races.

HEADLINES

🧑‍🍳 What else is cookin’?

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

• TikTok owner sacks intern for sabotaging AI project.

• Hugh Hefner’s son offers to buy Playboy brand for $100M.

• PM Modi, China's Xi Jinping to hold bilateral talks tomorrow on sidelines of BRICS summit.

• Cuba fights to come back from a nationwide blackout, then a storm that killed six.

• Ex-Abercrombie CEO charged with running sex trafficking ring.

CULTURE

🍿 Entertainment, Entertainment, Entertainment

• Diwali season is upon us (and Bollywood). Kickstarting the festivities, Manish Malhotra's hosts his 2024 Diwali Bash.

• Jodhpur teenager Sanskar Saraswat jumps to India No. 1 in Under-19 boys singles [badminton].

• ‘Beef’ Season 2 officially a go at Netflix with Oscar Isaac, Carey Mulligan, Charles Melton and Cailee Spaeny.