One quick thing: Bhavish Aggarwal pledges 1.1% stake in Ola Electric to support AI firm Krutrim   

In today’s newsletter:

• Big boost for Sachin Bansal's Navi
• Meesho, BlueStone, PayU IPO incoming 
• India's electric 2W sales top 1 million in 2024

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The Reserve Bank of India (RBI) today lifted the restrictions imposed on Sachin Bansal's Navi Finserv Ltd, just two months after they were implemented. 

• This reversal is noteworthy considering the lengthy restrictions placed on other major banks like HDFC Bank and Kotak Mahindra Bank

The RBI had initially imposed the ban on Navi Finserv and three other non-bank finance companies (NBFCs) due to concerns over usurious lending practices, including high-interest rates, unfair charges, and loan evergreening.

• The ban imposed a cease and desist sanction and disbursal of loans

After multiple discussions, Navi addressed a few of RBI’s main concerns, which revolve around borrowers’ rights 

• The central bank cited Navi's efforts to rectify deficiencies and adopt revamped systems and processes, particularly to ensure fairness in loan pricing

The lifting of restrictions is a significant win for Sachin Bansal, who owns a controlling stake of over 98% in Navi Finserv.

• Navi has managed to convince the regulator in quick time following the ban, a feat that even large banks in the country have failed to achieve

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Prosus' 6-month journey: A poem

"Prosus, a giant, strides the tech scene,
Last six-months, a mixed screen.
Edtech's promise, a fading light,
Foodtech's spark, a hopeful rise.
Fintech expanding, new paths in sight." 

Prosus is preparing to take several of its portfolio companies public over the next 18 months.

• Meesho, BlueStone, PayU, and Urban Company are among the top names, it said in its half-yearly disclosures

This confidence is fueled by the success of Swiggy's IPO, which has solidified its position as the crown jewel in Prosus' Indian portfolio.

“We have around 30 investments in India ($8 billion deployed to date) and many more IPOs ahead over the next 1.5 years…We see immense potential to crystallize value over the coming years,” Prosus' CEO Fabricio Bloisi said.

It is further readying its future IPO candidates including Captain Fresh, Mensa Brands, and Eruditus.

Prosus’ enthusiasm for the Indian market follows a mixed performance of its portfolio.

• PharmEasy: Still struggling with a -38% IRR, proving to be a major drag
• Meesho & PayU: Drops in performance metrics, reflecting market shifts. But remain stable (20-21% return) 
• ElasticRun: At a solid 23% IRR, among the best in Prosus' India portfolio
• Eruditus: Lowest returns at 14% 
• Byju’s: Written down to zero, a $493 million fair value loss

PayU is slowly picking up pace, with steady growth in payments and credit, helping Prosus get back on track after a tough regulatory stretch.

Prosus is expanding its footprint in the Indian fintech landscape.

• The Dutch investor has invested $80 million in supply chain finance firm Mintifi and $100 million in Vastu Housing Finance–its other two potential IPO candidates

Swiggy reported revenue of $750 million in the first half of FY25, marking a 40% surge from last year.

• Prosus had sold a $500 million stake during the IPO, making over $2 billion in gains.

Losses improved significantly with adjusted EBITDA shrinking by 41%, from -$145 million to -$85 million.

India's electric two-wheeler market has hit a major milestone, with sales crossing 1 million units for the first time in a calendar year as of November 2024.

The festive season and attractive discounts from top players like Ola Electric, TVS and Bajaj have fueled this surge, with retail sales rising 37% year-on-year to reach 10.7 lakh units by November 30, as per the government's Vahan portal. 

• While the aggregate numbers for the year-to-date is growing, in November sales declined 15% month-on-month to 1.18 lakh electric scooters on account of tapering of demand post October festive sales

In the peak festive month of October 2024, the domestic electric two-wheeler (E2W) market witnessed a month-on-month growth of nearly 54%.

Ola Electric maintains its leadership with a 24.5% market share, although it saw a 30% drop in sales compared to October. 

• Still, its November sales of 29,191 scooters were almost identical to last year’s figures, signaling consistent demand in a growing market  

What's more interesting is that TVS Motors and Bajaj are in a stiff competition and are battling for the second spot.  

• TVS Motors, with its flagship iQube scooters, drove its market share to nearly 22.7% as of November, which is close second to Ola’s 24%
  
  
• Bajaj Auto came in at the third spot with 22% market share

Ather continues to be the fourth-largest player with retail sales touching  12,741 units in November 2024, up 38% year-on-year.

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• Amazon.com founder Jeff Bezos joins Samsung in a $700 million bet on Tenstorrent, valuing the AI chip startup with ambitions of taking on Nvidia at about $2.6 billion.
  
  
• Vodafone Idea has launched an AI-powered spam management solution to protect users from unwanted messages.

Have you ever wondered what truly drives a brand's success in today's digital age? 

• Is it the physical products they sell, or the invisible forces shaping consumer perception?

Capitalism Without Capital offers an exploration of the intangible assets that power modern businesses. 

Check it out on Amazon

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