🧐 Adani's App Ambition: Trouble for RIL?
Adani's ambitions know no end. And this time his ambitious plans are challenging Tata and Ambani. Here's how.
Honest Confession: We did not want to write about Adani again.
We know we've been covering news about Asia's richest man a little too frequently, so we decided not to write about Adani for some time.
But this man just does not rest! He is constantly making news and important news: news that impacts India, its economy and its people.
So, here we go again!
And today we have lots to talk about: Adani's new competition with Ambani, his super app, his media ambitions and much more.
So, buckle up and let's dive deep into the Adaniverse.
👀 Adani's Super Ambitions
It is fast becoming clear that all major conglomerates in India want to control every aspect of your life.
Adani is no different. The Adani Group wants to be on the top of your mind at every stage of your life, from powering your house to stocking your kitchen to even helping you fly across the world.
Yes, Adani operates around 7 airports in India and 20% of our country's aviation traffic is indirectly under his control (You can read more about this here).
Now he wants to extend this control and help you commute to and from the airport.
He is now reportedly investing in taxi fleets to provide rides to and from his airports.
Sounds great, right? But that's not where Ambani's ambitions end, obviously.
He wants to compile all of the above services he provides (and probably more because this man wants to enter every business he possibly can) into one super app (here's how the whole super app craze began).
Why?
Well, because it ensures that no matter who you are, where you're from, what you buy, you're going to be putting money into Adani's pocket.
Picture this:
You go on the super app to buy groceries from Adani Wilmar. Now, just as you were signing off, an interesting discount offer for taxi services catches your eye. You think to yourself 'eh, don't need it now' and press back.
Now, two weeks later:
You're flying home for New Year's and you take out your phone to book a cab to go to the airport. You remember 'I have that discount on Adani's super app, let's try that' and off you go to the airport in a comfortable and affordable ride.
Do you realise what just happened?
You just switched from Uber (even though you were their loyal user) to Adani's app just because its interesting offers stayed with you. Great way to ensure brand loyalty.
But, does the timing seem right?
The tech industry is having a really bad time and existing super apps are not performing well.
Alibaba witnessed a surprise loss last quarter.
Tata Neu, India's first true blue super app, also hasn't been doing all that well. It has only managed to gain 15 million downloads in 7 months. Engagement is also below 40%.
Launching a super app might not make much sense now. And especially not for Adani. Unlike Tata or Ambani, our guy mainly has B2B businesses like mining, ports, infrastructure and so on.
So, even if he does launch a super app it won't really be super, meaning it won't be a one stop shop for all your problems unless…
Adani is planning a few more acquisitions and is getting deeper into the businesses that Tata and RIL are in.
💰 Adani's Latest Loot
Adani has already been competing heavily with RIL in the B2B space.
The two companies are fighting to gain control of Future Retail, giving competition to each other in the renewable energy space and now even competing in Ambani's home turf, the petrochemicals spacespace (You can read more about the Adani-Ambani rivalry here and here).
Yes, Adani is doubling down on the oil to chemicals space, investing $4 bn in it. His new chemical factory will be situated in Gujarat, the same place where Ambani's factory is.
But Adani does not see this as competition. He believes "India is a huge growth market and everybody is welcome."
Meanwhile, he has also managed to acquire a majority stake in NDTV, giving Ambani competition in the media space as well (Ambani owns the Network18 Group).
So, very soon, Adani could also enter other businesses that RIL is into, to give a boost to his super app.
The next target could very well be financial services.
This could make things difficult for Ambani, who had already lost the tag of Asia's richest man to Adani.
But Adani has one problem that Ambani doesn't: Massive debt (around Rs. 2.2 trillion!)
However, he is trying to solve this through a follow on public offer (FPO).
Huh?
A follow on public offer (FPO) is when a company raises money through equity (sale of shares) after an IPO. It is basically the sequel to an IPO.
And Adani Enterprises wants to raise Rs. 20,000 crores through this FPO. This will help the company pay off some of its debt.
But will people subscribe to Adani's FPOs?
Well, Adani Group shares have been seeing an insane rise for some time now.
So, retail investors could be interested in the FPO, especially because it will allow them to buy Adani Enterprise shares for a price that is cheaper than the market value.
So, it seems like things are looking up for Adani, they kind of always are.
However, many believe that the group's rise is a bubble waiting to burst.
Which side of the debate are you on? And should we write more about Adani?
⚡In a line: Adani is building a super app and it could step on the toes of other giants like Tata and Ambani?
💡Quick question: Will Adani's super app be a success?
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Would love an article on the impact of Adani going down, how will it impact the Indian economy and affect the common man
ADANI has use and throw mentality even his employee is not happy in that case can not rely on him