Summary of the Conference Call on India's Internet Sector Industry Overview - The conference call focused on the **India Technology – Internet** sector within the **Asia Pacific** region, highlighting recent trends in **PE/VC funding** and the performance of the **internet market cap index** in India [1][8]. Key Points 1. **Funding Trends**: - There has been an improvement in **PE/VC funding** trends over the past few months, with a notable uptick in October 2025, where total funds raised reached **US$1,387 million**, a **123% increase** from **US$621 million** in September [29][32]. - Despite the month-over-month increase, the funding remains down on a trailing twelve-month (TTM) basis, indicating a mixed outlook for the funding environment [8][14]. 2. **Market Correction**: - The **India internet market cap index** has corrected by **6%** since its peak in September 2025, contrasting with a **1% increase** in the NIFTY index during the same period [3][14]. - This correction is viewed as healthy, especially after a significant rally of **38%** from mid-March to September 2025 [4][14]. 3. **Performance of Key Stocks**: - Major stocks like **MakeMyTrip (MMYT)** and **Eternal** experienced sharp corrections post-earnings, while some smaller and mid-cap stocks have shown positive returns after their quarterly results [4][24]. - **Eternal** is highlighted as a top pick due to its strong focus on customer acquisition and retention, with significant app downloads and monthly active user (MAU) share [5][24]. 4. **Sector Maturity**: - Different segments of the internet market are at varying stages of maturity. For instance, **Quick Commerce** is still in a growth phase, suggesting that focusing on customer acquisition is crucial for companies in this space [5][24]. 5. **Comparative Market Performance**: - The Indian internet index has underperformed compared to the US internet index, which reached new highs, while other markets like **China** and **ASEAN** have also seen corrections of **6%** and **11%**, respectively [3][22]. 6. **Investment Focus**: - Investors are currently prioritizing growth and profitability, with a notable interest in mid-stage funding, which accounted for **57%** of the total funding activity in October [29][56]. - Categories such as **e-commerce**, **fintech**, and **enterprise tech** are highlighted as the main investment attractions for the month [29][35]. Additional Insights - **MAU/DAU Data**: - Third-party data indicates that **Paytm's** MAU/DAU share remained stable, while app download shares for major e-commerce players like **Flipkart** and **Amazon** moderated month-over-month [30][62]. - **Stock Performance**: - Most internet stocks have underperformed compared to the **Sensex** in the past month, with only a few exceptions like **Paytm**, **Cartrade Tech**, and **Blackbuck** showing positive performance [24][26]. Conclusion - The Indian internet sector is experiencing a complex landscape characterized by a recent correction in stock prices, improving funding trends, and varying stages of maturity across different market segments. Investors are advised to focus on companies with strong execution and growth potential, particularly in the e-commerce and fintech spaces.

Market Sentiment - The recent stock market runup is being compared to nostalgic moments, suggesting a need for caution as these times may not last forever [1][2] - There are parallels drawn between the current AI-driven market and the internet bubble, indicating potential for both positive and negative outcomes [3][4] Investment Environment - Unusual market behaviors and statements from industry leaders are raising concerns about the sustainability of current valuations [5][7] - Historical examples from the dot-com era illustrate that even fundamentally strong companies can experience significant declines post-bubble [9][11] Growth Projections - Current growth rates, such as Taiwan Semiconductor's 16.9% year-over-year sales increase, may not be sustainable, leading to potential deceleration in future growth [13][14] - The market's momentum could be questioned if growth rates slow down and major deal announcements decrease [14] Investment Strategy - Caution is advised in adding to positions during what is perceived as a bubble, as buying at high prices often leads to losses [15][17] - Defensive strategies may be necessary, especially with the current yield on 10-year Treasury bonds at 4%, providing a risk-free income alternative [16][17] Year-End Considerations - The significant 43% rally since April suggests that investors might consider moving to the sidelines as the year ends [17][18]

Market Trends & Potential Risks - RBC Capital Markets warns traders to prepare for a potential protracted selloff in the dollar [1] - The dollar's boom-and-bust cycle could mirror the Internet bubble [1] - Current drivers supporting the dollar could turn into headwinds [1]

If you mean it's like the internet bubble where in the end something very profound happened. The world was very different. Some companies succeeded but a lot of the companies were kind of meto fell behind uh burning capital companies.Absolutely. There are a ton of these investments um that will be deadends. >> And you look at all the investments that are being made today by some of the big tech companies.some companies who are not making money on AI yet but are making massive commitments to chip makers and ...

Industry Trend - AI is a reality, similar to the adoption of cars and TV [1] - The AI sector may experience a bubble, potentially leading to significant financial losses, similar to the internet bubble where approximately 1 trillion dollars was lost [1] Company Performance - Some companies will emerge as hugely beneficial from AI, like Google, Facebook, YouTube, and Microsoft from the internet era [1]

Core Insights - The S&P 500 is experiencing record concentration among a small number of stocks, which raises concerns about the sustainability of high valuations [1] - This concentration suggests a potential need for investors to diversify their portfolios to mitigate risks associated with over-reliance on a few stocks [1] Investment Implications - High valuations in the S&P 500 indicate that the market may be overvalued, prompting a reassessment of investment strategies [1] - Broadening investment portfolios could provide better risk-adjusted returns in the current market environment [1]