Good morning! Elon Musk is… an interesting character. Speaking at the DealBook conference, Musk lambasted companies that stopped advertising on his newest and dearest venture, X. He was not happy by their hand-twisting tactics and claimed that their actions could potentially kill the company. Then, in a classic Elon switcheroo, he told advertisers to “Go f**k yourself”. Twice. The second one seemed to be aimed at Bob Iger, Disney’s CEO. We’re no experts here but that’s not probably the best way to win people over. 

Dinesh Narayanan and Adarsh Singh also contributed to today’s edition.

The Market Signal 

Stocks & Economy: The Indian economy put up a surprisingly strong show in the July-September quarter. Government data showed the economy grew by 7.6% during the period. That’s way faster than the Reserve Bank of India’s anticipated 6.5% and could push it to tighten interest rates.

The growth has come from manufacturing and construction but alarmingly, agriculture output fell 1.2%, the lowest in four and a half years. 

Oil prices may rise after OPEC+ decided to cut production by one million barrels more. 

What could balance the lower supply is lower demand in the Eurozone, where inflation is falling faster than expected. US consumers too slowed down purchases in October. The S&P 500 ended November with a near 9% gain. That did not enthuse Asian indices on Friday morning though. Most of them were in the red. The GIFT Nifty was indicating a similar opening for Indian equities too.

EDTECH

Three Point Turn

BYJU’S has had bad things coming in droves for a while, but a trifecta of developments is bound to make what was once India’s most-valued startup stare into the abyss for the foreseeable future.

One: Investor Prosus has slashed BYJU’S valuation to less than $3 billion, a whopping 86% drop from its $22 billion peak. Prior to this, BYJU’S valuation was marked down to $11 billion, $8 billion, and $5 billion this year alone.

Two: The Board of Control for Cricket in India has filed a case against BYJU’S parent Think & Learn at the National Company Law Tribunal, probably for missed sponsorship royalty payments amounting to ~$20 million. The next hearing is on December 22.

Three: The Enforcement Directorate has alleged several Foreign Exchange Management Act violations by BYJU’S, including failure to submit critical documents days after it issued a show-cause notice to BYJU’S and founder Byju Raveendran.

GEOPOLITICS

The Post-Kissinger World

Henry Kissinger, one of the world’s most influential but polarising diplomats, is dead. Kissinger was 100 years old. 

The former US secretary of state and national security advisor never faded away from the diplomatic scene and advised governments on critical global developments to his last days. His legacy is intact in West Asia, where secretary of state Anthony Blinken is following “shuttle diplomacy”, a Kissinger invention. 

In the post-Kissinger world, China appears to have an edge though. Saudi Arabia has promised Iran investments if the latter reins in its war dogs. The two formerly inimical countries were brought together by China, a country Kissinger helped prop up in the 1970s. 

He had a testy relationship with India, and once called Indians “bastards”.

Meanwhile, the US has linked the Indian government to an alleged plot to kill US-based Sikh separatist, Gurpatwant Singh Pannun, and three others in Canada. 

ENTERTAINMENT

Serious Battle. Just Kidding

Since his return as CEO, Bob Iger has been putting out fires at Disney, including a corporate knife fight. Looks like some of his fire-fighting ideas were just that. In an interview with The New York Times, Iger denied Disney’s legacy TV networks such as ABC were on sale, less than six months after declaring them not “core” to Disney’s growth.

Why?: Iger says he was just testing investor reactions to the idea. Besides, he didn’t want to look like an “old media executive”.

In India, Disney is reportedly close to a deal to sell Star, whose streaming service Hotstar is bleeding money and TV profits shrinking. Meanwhile, Sony’s heavily delayed merger with Zee may crash and burn: they can’t agree on a CEO. 

Also: Hollywood’s fave villain Warner Bros’ CEO David Zaslav defended his decision to pull the plug on fan favourite shows and films, saying they weren’t “personal” and needed in a disruptive time. 

The Signal 

Legacy entertainment and media businesses have never been in a more vulnerable position than they are today: new bets like streaming are eating up their cash while their reliable horses such as TV are declining rapidly. A cautious advertising market has hurt revenues while consumers are so spoiled for choice it’s nearly impossible to hold their attention for long. 

Top media execs are beholden to investors, who are losing trust in legacy media companies previously considered safe bets. So for now, profits override creative freedom. 

SEMICONDUCTORS

HCL Wants To Wrap It Up

Less than a week ago, we summed up why packaging is the next frontier in the global chip race. In essence, innovations in advanced semiconductor packaging tech are boosting efficiency and performance. It’s an area so critical that even the US can’t place curbs on Chinese packaging companies, lest that disrupt global supply chains.

Closer home, The Economic Times reports that HCL Group, the parent of IT major HCLTech, is in talks with the Karnataka government to develop a packaging unit with an investment of $400 million. The state has offered land in Mysuru and near Kempegowda International Airport in Bengaluru.

If the project goes through, HCL will join the ranks of Kaynes Technology, Micron, Tata, and the Murugappa Group, which are building chip packaging, assembly, marking, and testing facilities in India. The Centre is also courting international majors such as IBM, Tower, and Intel.

CORPORATE

Jack’s Hammer

Chinese e-commerce major Pinduoduo’s (PDD’s) blockbuster earnings have incumbent Alibaba so worried that founder Jack Ma took to the company’s internal message board to urge reform. It’s the first time in over three years that he’s intervened (if one can call it that) in this manner, ever since he stepped down and chose to maintain a low profile after landing in hot water for criticising Chinese banks and regulators.

In a memo to staff, Ma urged Alibaba to “pay any price” to course-correct. The Alibaba stock has dipped 15% this year due to a leadership reshuffle, restructuring, and a shelved spinoff of its cloud computing arm. Competitors PDD (which operates Temu) and ByteDance have also eaten into the company’s market share.

Alibaba, once valued at $850 billion, is currently worth $187 billion. Temu’s marketing blitzkrieg and laser focus on e-commerce has made it more accessible in the west than Alibaba.

🎧 What’s up with Alibaba and Jack Ma? Listen to The Signal Daily on Spotify, Apple Podcasts, Amazon Music, Google Podcasts, or wherever you get your podcasts.

FYI

State of states: Exit polls show the Bharatiya Janata Party likely forming governments in Rajasthan and Madhya Pradesh while the Congress is edging ahead of the rest in Telangana and Chhattisgarh. The counting of votes is on Sunday. 

A new beginning: Nepal became the first country in South Asia to record a same sex marriage when 35-year-old transwoman Maya Gurung legally wedded 27-year-old Surendra Pandey, who is gay. 

Flying start: The United Nations’ climate talks, COP28, began in Dubai with the establishment of a loss and damage fund for needy countries and opening it up for contributions throughout the two-week conference.  

Nothing to roar about: Tiger Global’s biggest venture fund has logged an 18% loss due to significant markdowns in portfolio companies such as OpenSea, Bored Ape Yacht Club, DuckDuckGo, and Superhuman, Bloomberg reports.

Arming up: India’s defence ministry has given the initial go-ahead to spend ₹2.23 lakh crore (~$26 billion) to buy combat aircraft, choppers and missiles. These include Tejas fighters and Prachand helicopters.

Free lunch: India will continue to distribute free foodgrains to 81.3 crore poor people for five more years, which will cost the exchequer ₹11.8 lakh crore (~$141 billion) in subsidies. 

Acquisition: AV Birla group’s UltraTech Cement is buying Kesoram Industries’ cement business with an annual production capacity of 10.75 million tonnes for an enterprise value of ₹7,600 crore (~$912 million).

THE DAILY DIGIT

18

The number of bills slated to be introduced in the winter session of Parliament beginning December 4. These include amendments to the tax law and a set of codes to replace the IPC, CrPC, and the Indian Evidence Act. (The Economic Times) 

FWIW

‘Tis the season: Nothing screams holiday season like an ugly sweater, and it looks like Microsoft knows it too. The company launched a sweater with a stylised version of the Bliss (default) wallpaper for Windows XP. As if that wasn’t corny enough, it comes with an oversized mouse cursor and has instructions like “Machine wash cold, tumble dry low, and never take off.” But that hasn’t stopped Windows XP nerds from lapping it up. The sweater is already sold out in the most common sizes. Just another day slaying at the office for Satya.

Dumb and dumber: China’s biggest celebrity chef, Wang Gang, has decided to never make egg fried rice again. The chef faced a deluge of criticism from China’s hyper-nationalists for posting a video making egg fried rice on November 27. What’s the big deal, you wonder? It turns out that the date marks the death anniversary of Mao Anying, Mao Zedong’s eldest son. As per the legend, Anying died in the Korean War because he gave away his hideout’s location by making egg fried rice. Wang’s video is supposedly a mockery of that incident. Really don't know what to say here…

Chinks in the armour: CAR-T cell therapy was cleared by the FDA in 2017 as a potential treatment against cancer. It involves removing certain immune cells called T-cells from patients and genetically modifying them to find and attack cancer. But recent studies suggest that some patients who received this cutting-edge cancer treatment later developed new cancers. While the FDA is investigating the matter, it still maintains that the benefits outweigh any potential risks. Eh, not the best day for science.