Good morning! The Chinese government has zero chill for those who flaunt their riches online. As per The Financial Times, China's internet watchdog has banned the social media accounts of hundreds of 'show-off influencers'. One of them, Wang Hongquanxing, aka China's Kim Kardashian, once bragged that he never steps out of home in clothes and jewels worth less than 10 million yuan (Rs 11.32 crore). Will he keep his word now that he can't upload pictures in bougie garb? We ain't so sure.

🎧 Why are so many Ola and Uber drivers following the ‘No AC Campaign’? Also in today’s episode: ugly sneakers find unlikely luxe status. Tune in to Spotify, Apple Podcasts, Amazon Music, Google Podcasts, or wherever you get your podcasts.

Anjali Palod, Roshni Nair, and Anup Semwal also contributed to this edition.

The Market Signal* 

Stocks & Economy: US and UK markets were closed on Monday on account of Memorial Day and the Spring Bank Holiday, respectively.

Several countries, including the US, EU, and Japan, will release fresh inflation data this week. Japan has retained its status as the world’s top creditor following the sixth straight year of a rise in net external assets. Asian markets were mixed in the run up to potential rate cuts by the European Central Bank.

A Reuters poll of economists revealed that India's economy likely grew at its slowest pace in a year in the January-March quarter due to weak demand. Benchmark indices hit fresh all-time highs on Dalal Street, with banking and IT stocks leading the way. The Sensex crossed 76,000 for the first time and the Nifty crossed 23,100 for the first time, but both beat a retreat at closing.

The GIFT Nifty indicates a flat start for domestic indices today.

RETAIL

E-Commerce Loses Its Sheen 

In a departure from previous trends, recent reports reveal a downturn in e-commerce sales during Q4FY24, according to data from logistics companies. Contributing to this shift is the absence of festive sale periods, which traditionally drive heightened activity especially for smartphones and apparel. Consumers have either not shopped for these items, or have preferred offline channels this quarter.

In response, brands like Mamaearth are looking at strengthening their offline expansion, The Arc reported. Honasa Consumer, its parent company, reported single digit growth in FY24 and plans to network directly with distributors rather than go through stockists, aiming to improve offline sales. Nykaa also reported that brands are opting for discounts rather than advertising, given the muted demand.

PODCAST

Tune in every Monday to Friday as financial journalist and host Govindraj Ethiraj gives you the most important take on the latest in business and economy.

In today’s episode, he speaks to Aditi Nayar, chief economist, ICRA, about India’s economic slowdown in the last quarter. Also in today’s episode: India’s power demand is surging amid heatwaves and usage patterns are shifting. But is there enough supply? With Dr Ashok Sreenivas, group coordinator, Prayas Energy Group.

TELECOM

This Time For Africa

The competition between India’s largest telcos isn’t confined to the domestic market and setting up undersea cables that form the backbone of the internet. Radisys, a subsidiary of Reliance Jio, is partnering with Next-Gen Infrastructure Company (NGIC) — a consortium of African telcos K-Net and Ascend Digital Solutions Ltd — to deliver “affordable 5G services across Ghana”. The government of Ghana will hold a nearly 10% stake in NGIC.

Jio rival Bharti Airtel is the second-largest telecom operator in the continent.

The venture marks Reliance’s entry in Africa’s telecom market, one of the fastest-growing in the world. The goal is to replicate its cheap data playbook in the region, and segues with India’s ambition to introduce payment platforms such as UPI and RuPay in other territories. Reliance/Radisys’ plan to offer 4G/5G infrastructure and compatible smartphones in west Africa will pit it against vendors like Huawei, Samsung, Nokia, and Ericsson.

TRENDS

Ugly Is In Again, But For How Long?

Would you spend over $600 on a pair of sneakers that look like they’ve seen better days? Apparently many would, including celebrities such as Taylor Swift and Selena Gomez. Now, the Italian luxury sneaker brand Golden Goose is about to file for an IPO. In the first quarter of this year, its net revenues for 2023 were up 18% to 587 million euros. 

Trending risk: Golden Goose isn’t the only premium shoe riding the celebrity wave of ugly shoes. There’s French-American ‘dad-shoe’ brand Hoka, favoured for its comfort by famous people including Britney Spears and US President Joe Biden. In 2022, it crossed $1 billion in sales. But it’s under threat from other ugly, high-performance shoes including sports giant Adidas. 

The Signal 

Golden Goose and Hoka aren’t the first to cash in on the ugly shoe parade; luxury heavyweights Balenciaga and Gucci sold deliberately dirty sneakers at ridiculous prices in the 2010s. They made it big as actors, musicians, and other celebrities embraced “ugly” comfort, lifting the fortunes of premium brands such as New Balance, Hoka, and now, Golden Goose. 

But as with all trends, what goes up must come down. Golden Goose is about to strike gold, but Hoka may already be losing its hot streak. Meanwhile, sales of the OG sneaker Vans are falling so much, its parent firm VF Corp has put up private jets and a hangar on sale. 

FYI

Cough it up: Kalanithi Maran and his KAL Airways is seeking Rs 1,323 crore in damages from Spicejet and its promoter Ajay Singh; the Delhi High Court cancelled an earlier order asking Singh to pay Maran Rs 579 crore with interest. 

💰💰💰: Adani Energy Solutions will raise up to Rs 12,500 crore via a qualified institutional placement. Parent firm Adani Enterprises is meeting today to approve a fundraising plan too.

Money maker: Car maker Hyundai has appointed Kotak Mahindra Bank and ̨Morgan Stanley to advise on a planned IPO of its India arm, Bloomberg reported. 

Tragedy: Cyclone Remal has killed at least 16 people and cut off power supply in Bangladesh and parts of West Bengal. 

Drama has value: Elon Musk’s AI startup xAI has been valued at $24 billion after raising $6 billion in a Series B funding round led by Sequoia Capital and Andreessen Horowitz.

THE DAILY DIGIT

34°C

The temperature in Qazigund on May 27. It’s the highest temperature ever recorded in the gateway town of the Kashmir Valley. Meanwhile, Jammu scorched at 42.8°C. (Greater Kashmir)

FWIW

Hamster wheel: What makes an employee wellness programme super popular? Free gym or yoga? Nope. Health checks? Nah. Marathons? Bingo! Corporate India wants to care for employees' wellbeing, but the key is to make those programmes fun. For example, at TCS, marathons are a big hit, not least because employees often bump into senior leadership mid-run. Many companies have ditched gyms and yoga for dancing and zumba. Maruti Suzuki even has in-house cricket and football leagues. Now that's how you keep the workforce fit and fired up! 🔥