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One year of Russia Ukraine war – impact on the world

by Tavaga Invest

Markets this week 📊

Geopolitics ruled this week with old friends renewing their friendship vows. US and Ukraine on one hand, China and Russia on the other. Our (not so) dearest neighbour, Pakistan turned out its pockets as the country’s economic crisis deepens. India on the other hand got its claim to fame as it may seal a seat as the head of the World Bank.

Central bankers continued to hold their guns pointing toward inflation keeping the investors on the edge.

Banks have enjoyed a spectacular dream run with double-digit credit growth in the past few quarters. But this honeymoon period may slow down as the battle for deposits intensifies and the net interest margins take a beating. That will probably separate the real men from the bunch of boys!

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That might take care of all your spiritual worries, for all your portfolio conundrums, you can opt for ChatTavaga. 

Let’s now dig deep into some of the important news that made headlines this week

Jio set to kill TV 🏏

Ambani hits a six: Reliance-backed Viacom18 has bagged the streaming rights for the IPL for 24K crores, after having won exclusive streaming rights for the Fifa World Cup earlier this year. But in typical Ambani style, IPL streaming is to be done for free in 4k resolution

Free, Free, Free! For last 10 years, IPL streaming rights under Disney+Hotstar had given the company unprecedented growth in paid subscribers and the No.1 position in the Indian OTT market. Just last year, it recorded 90%+ growth in revenues and a doubling of ad revenues. Then why is Jio giving up this trump card, you may ask? Mr. Ambani wants to stick to the same strategy he used when launching the Jio telecom services. Get people used to the free service for a limited period and then go paid. Voila!

Experience is what matters: Reliance is leaving no stone unturned to make our old-age TV sets obsolete. They are betting on making a complete behavioral shift and differential experience for audience + advertisers. But all this will boil down to a flawless viewing experience that Disney+Hotstar had been delivering all these years. Reliance needs to learn from the initial hiccups during Fifa World Cup to make this plan work. 

Bye Bye TV? The Pandemic has already caused a huge shift to streaming and digital media over the past few years. With IPL streaming free, TV service providers are going to have an even tougher time chasing down paying customers, and whatever they had left is also gonna be disrupted. Why? Jio is finally thinking of entering the cable Tv market right before the IPL with ranges of plans between 500-2000. 

Our take

Nothing is frankly free. Viewers will have to pay for data charges and will be forced to shift to an unlimited data plan or opt for more than 2GB data per day. Non-Jio fans will have to shift to Jio to enjoy the series, thus boosting their data subscribers.

Everything said and done, TV may be a thing of the past but the IPL definitely won’t be. Till then let’s cheer for our favourite teams and enjoy being freeloaders. 

Happy 1st Anniversary ⚔️

One year: The longest armed conflict in the history of Europe since WWII continues to drag. There is still no end in sight. More stringent sanctions will continue to be imposed and the allies are likely to follow. While the war has had no decisive turn, several things changed course in the past 365 days. 

Quick recap: Oil price crossed the $103 per barrel mark – the highest since Aug 2014. The war caused enormous infra losses and unforeseen disruptions in global supply chains. One year later, the world continues to be on edge. Oil prices have now retreated and are around $80 levels. India has played smart in this whole episode and wisely chose to prioritize its own economic needs. Russia has become the largest supplier of oil to India and mind ya, this is a structural change and is likely to remain even if the war ends. Global supply chains of other commodities are gradually coming back on track. Inflation is also coming under control, although not at the pace desired by central bankers worldwide.

Promises and ultimatums: US President Biden flew to Kyiv, for the first time in the last 1 year. He stood rather tall as he walked with Zelensky amid blaring air raid sirens, sending a message of continued support to bring Putin down. It was a rather rousing speech to reassure the world and the people of Ukraine that the US is “in it for the long haul”. Putin is in no mood to bow down still, threatening to break the LAST Nuclear Arms Control pact.

Our Take

Putin is increasingly getting isolated and does not enjoy the same charisma as last year. Investors too have shrugged off most of the concerns. This war may continue to play havoc with global food and energy security but, for stock markets, it’s Powell rather than Putin who will decide the fate. 


Chinese tycoon missing, AGAIN 🚨

What the $#%^^! One of China’s most high-profile billionaires and CEO of China Renaissance Holdings, Bao Fan is nowhere to be found. He is a bigshot broker dealing with firms like Didi and Meituan. The company’s shares took a nosedive when the BoD announced that they have no clue about Fan’s whereabouts. Bao is suspected to know the insider details of many big deals that shook the Chinese market and he may be of interest to President Xi.

Fishy: This has yet again evoked a history of Chinese executives suddenly vanishing for periods of time with no explanation. Disappearances are linked to allegations like corruption, tax fraud, and other misconduct and people usually end up in jail or are underground till things cool down back home. Crazy!

Why the crackdown? China’s President Xi Jinping persists in his longstanding campaign against corruption. The Chinese government has previously unleashed the Kraken on several big industrialists, including technology, education, and real estate. All to support Xi’s “common prosperity” agenda to “keep income distribution equal and well-regulated”.

Nothing new: Disappearances are common in China and this incident just added to the laundry list of billionaires and top execs going missing. At least 6 billionaires including Alibaba’s Jack Ma have gone underground for extended periods in the past. 

Our Take

These disappearances seem far from random and come at strategic timing, like in the case of Jack Ma right before the listing of his company which would have made him China’s richest man. What happens in China usually stays in China and we wonder how long the government will keep getting away with it.


Blue ticks on sale ☑️

If you cant beat ‘em: To take away some of the limelight from Musk, Meta too joined the blue tick bandwagon. His own version of a blue tick called the “Meta Verified” to be first made available in Auz and NZ for $11.99/month. The coveted tick offers account verification, fraud protection, and of course greater visibility. 

Subscription club: Meta is playing catch-up after Twitter and Snap already deployed the “turn users into subscribers” game plan. Ad revenues were Meta’s bread and butter, but not anymore. After Apple’s new privacy policy made user data tracking difficult, Meta and Insta’s ad revenues have taken a massive $10 billion/year hit. This coupled with the economic slowdown has pushed Meta to look for other money-making options. 

Our Take

Subscriptions can provide a reliable stream of revenues but are there any takers for a kinda dead platform? Plus Meta Verified may not be completely ad-free compared to Twitter Blue which promises 50% fewer ads. For creators, it may still be worth a shot to secure their online profiles but ordinary users may stay away. 

What else made the news?

🥳 Zero Covid: China declared that the COVID epidemic has “basically” ended but it will still monitor new variants. 

😃 Netflix cheaper: Netflix has slashed subscription prices around the globe as costs have gone down in more than 30 countries to take on competition. 

😰 Freshers beware: Fresher hiring is expected to slow down and drop 40% in some IT firms. It major asked candidates to settle for a 50% pay cut. 

More hours: NSE extended trading hours for interest rate derivatives till 5pm. 

🤝 Handshake: China and Russia have renewed their friendship vows despite pressure from the West. 

💸 Stressed sale: Low-cost carrier SpiceJet offers to sell a 5% stake to an aircraft lessor to pay off dues worth $100 million.

Tavaga is everything you need to start saving for your goals, stay on track, and achieve them in time. 


Ruchi Mehta



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