SPA Securities has come out with report on Burnpur Cement IPO. The firm has advised to ignore the issue.
Burnpur Cement (BCL), one of the established cement manufacturers of Eastern India, is open for subscription with its initial public offer of 2,19,00,000 equity shares of Rs 10 each for cash at a premium of Rs 2 per share. The issue will close on December, 3, 2007.
SPA Securities report on Burnpur Cement IPO
Investment Highlights
BCL has grown at a CAGR of 41% in the topline; 94% at EBIDTA level & 96% in the bottomline in the last three years.
Investment rationale: Company is setting up an integrated clinkerisation and cement grinding plant of 800 TPD expandable to 1600 TPD in Hazaribagh, Jharkhand. BCL’s has focused on under developed areas of Eastern India. BCL has the locational advantage & government subsidies. Company has entered into a MOU with the government of Jharkhand, whereby the government will extend the assistance for promotion and establishment of the proposed project of the company. The company has a wide distribution network in Eastern India.
Concerns are: Limestone for clinker shall be obtained from JSMDC for which mining agreement is yet to be entered. Low capacity utilization. Non-availability of clinker and bottlenecks in the production process. Low installed capacity does not have any economies of scale. High debt post expansion and huge equity base would be EPS dilutive.
For the quarter June 2007, the company recorded a topline of Rs 7.27 crore., operating profit of Rs 1.04 crore. & a PAT of Rs 0.36 crore. translating to EPS of Rs 1.28 (annualized) & RoNW of 9.24%
Valuation: The stock is currently available at a P/E of 45x of its Post-issue EPS of Rs 0.27, which is expensive vis-à-vis its peers. On EV/EBIDTA, it is valued at 19x which too is very expensive when compare to its peers, which are trading in range of 11-14x EV/EBIDTA. BCL posted OPM of 12.80% & NPM of 4.36% in FY07, whereas its peers have posted an OPM in the range of 17% to 36% and NPM in the range of 11% to 21% in the same period.
BCL have lowest profitability among its peers mainly due to the high purchase cost of clinker. We are of the view that margins will increase only after the current expansion is completed i.e. in October 2008. Moreover, this being very small company in terms of revenue as well as market-cap, liquidity and institution participation will be a major disadvantage. Hence, we recommend ignore the issue.
Source: Moneycontrol.com
Thursday, November 29, 2007
Subscribe to BGR Energy IPO
Pranav Securities (P-sec) has come out with report on BGR Energy Systems IPO. The firm has recommended to subscribe the issue.
BGR Energy Systems, a supplier of systems and equipment for the power, oil & gas, refinery, petrochemical and process industries, proposes to enter the capital markets on December 5, 2007 with a public issue of 9,136,000 equity shares of Rs 10 each through 100% book building process.
Pranav Securities report on BGR Energy Systems IPO
* BGR Energy Systems offers products and solutions for the supply of systems & equipment as well as turnkey engineering project contracting catering to the power, oil & gas, refinery and petrochemical industries.
* The company clocked a CAGR of 50.5% for the topline and 50.6% for the bottomline over FY02-07. The company’s margins have been improving from 9.2% in FY03 to 11.06% in FY07 (18 mths).
* The company’s current order backlog stands at Rs 33.2 billion with 76% coming in from the power project business.
* BGR intends to raise money in order to expand its production facilities in India, China and Middle East as well as fund its working capital and general corporate r equirements.
* The issue is priced at 104.42x FY07 and 117.91x FY07 on lower and upper price band respectively. Though a bit expensive we are robust on the industry and believe the company will sustain its growth trend. We recommend Subscribe.
Source: Moneycontrol.com
BGR Energy Systems, a supplier of systems and equipment for the power, oil & gas, refinery, petrochemical and process industries, proposes to enter the capital markets on December 5, 2007 with a public issue of 9,136,000 equity shares of Rs 10 each through 100% book building process.
Pranav Securities report on BGR Energy Systems IPO
* BGR Energy Systems offers products and solutions for the supply of systems & equipment as well as turnkey engineering project contracting catering to the power, oil & gas, refinery and petrochemical industries.
* The company clocked a CAGR of 50.5% for the topline and 50.6% for the bottomline over FY02-07. The company’s margins have been improving from 9.2% in FY03 to 11.06% in FY07 (18 mths).
* The company’s current order backlog stands at Rs 33.2 billion with 76% coming in from the power project business.
* BGR intends to raise money in order to expand its production facilities in India, China and Middle East as well as fund its working capital and general corporate r equirements.
* The issue is priced at 104.42x FY07 and 117.91x FY07 on lower and upper price band respectively. Though a bit expensive we are robust on the industry and believe the company will sustain its growth trend. We recommend Subscribe.
Source: Moneycontrol.com
Minimum appl value for IDR issue cut to Rs 20k
Sebi has issued guidelines on Indian Depositary Receipts, or IDR, and fast track issues, reports CNBC-TV18.
It has amended DIP norms and issued eligibility norms for fast track issues. The minimum application value for IDR issue has been cut to Rs 20,000 from Rs 2 lakh. All categories of investors can apply for IDR issues and 50% is reserved for QIBs.
The reservation for existing shareholders is limited to individual retail shareholders. Listed firms meeting specified requirements can make FPO and rights issues.
Sebi has discarded special dispensation to DFIs and said that it has outlived its utility. The issue of proceeds report is not required for issues by financial institutions.
With regard to fast track issue, companies must be listed for at least three years. The average market capital of companies must be at least Rs 10,000 crore. Annualised trading turnover in the last six months must be 2% of listed shares
Source: Moneycontrol.com
It has amended DIP norms and issued eligibility norms for fast track issues. The minimum application value for IDR issue has been cut to Rs 20,000 from Rs 2 lakh. All categories of investors can apply for IDR issues and 50% is reserved for QIBs.
The reservation for existing shareholders is limited to individual retail shareholders. Listed firms meeting specified requirements can make FPO and rights issues.
Sebi has discarded special dispensation to DFIs and said that it has outlived its utility. The issue of proceeds report is not required for issues by financial institutions.
With regard to fast track issue, companies must be listed for at least three years. The average market capital of companies must be at least Rs 10,000 crore. Annualised trading turnover in the last six months must be 2% of listed shares
Source: Moneycontrol.com
Wednesday, November 28, 2007
Issues Open Now
Below are the current issue open:-
Burnpur Cement:
Offer Price: Rs. 12/-
Issue Open date: 28-11-2007
Issue Close date: 03-12-2007
eClerx Services:
Offer Price: Rs. 270 - Rs. 315
Issue Open date: 04-12-2007
Issue Close date: 07-12-2007
BGR Energy:
Offer Price: Rs. 425 - Rs. 480
Issue Open date: 05-12-2007
Issue Close date: 12-12-2007
Burnpur Cement:
Offer Price: Rs. 12/-
Issue Open date: 28-11-2007
Issue Close date: 03-12-2007
eClerx Services:
Offer Price: Rs. 270 - Rs. 315
Issue Open date: 04-12-2007
Issue Close date: 07-12-2007
BGR Energy:
Offer Price: Rs. 425 - Rs. 480
Issue Open date: 05-12-2007
Issue Close date: 12-12-2007
Tuesday, November 27, 2007
Jyothy Laboratories IPO subscribed 45x
Public issue of Jyothy Laboratories has received excellent response, subscribed 44.94 times till 5 pm, according to data available on NSE website.
It got bids for 19.9 crore equity shares as against 44.30 lakh shares on offer and received bids for 1.8 crore shares at cut off price.
The company entered capital market with an initial public offering (IPO) of 44.30 lakh shares of Rs 5 each at a price band between Rs 620 and Rs 690 per equity share.
The company will raise Rs 274 at lower price band and Rs 305.6 crore at higher end of price band.
The offer would constitute 30.52% of the post issue paid up capital of the company. Post issue, Jyothy Labs' promoters stake will remain at 69.47%. Its investors including Canzone Limited, ICICI Bank Canada, ICICI Bank UK PLC, South Asia Regional Fund and CDC Investment Holdings are selling their stakes through this offer.
The equity shares are proposed to be listed on the NSE and the BSE.
FMCG company is in the fabric care, household insecticide, surface cleaning, personal care and air care segments of the Indian market. It offers branded products including fabric whitener, mosquito repellent, dishwashing, bath and incense products.
Enam Securities Pvt Ltd and Kotak Mahindra Capita Company Ltd are book running lead managers and Intime Spectrum Registry Limited is the registrar to the issue
Source: Moneycontrol.com
It got bids for 19.9 crore equity shares as against 44.30 lakh shares on offer and received bids for 1.8 crore shares at cut off price.
The company entered capital market with an initial public offering (IPO) of 44.30 lakh shares of Rs 5 each at a price band between Rs 620 and Rs 690 per equity share.
The company will raise Rs 274 at lower price band and Rs 305.6 crore at higher end of price band.
The offer would constitute 30.52% of the post issue paid up capital of the company. Post issue, Jyothy Labs' promoters stake will remain at 69.47%. Its investors including Canzone Limited, ICICI Bank Canada, ICICI Bank UK PLC, South Asia Regional Fund and CDC Investment Holdings are selling their stakes through this offer.
The equity shares are proposed to be listed on the NSE and the BSE.
FMCG company is in the fabric care, household insecticide, surface cleaning, personal care and air care segments of the Indian market. It offers branded products including fabric whitener, mosquito repellent, dishwashing, bath and incense products.
Enam Securities Pvt Ltd and Kotak Mahindra Capita Company Ltd are book running lead managers and Intime Spectrum Registry Limited is the registrar to the issue
Source: Moneycontrol.com
Mundra IPO: What to watch out for!
The big listing today, has been Mundra Port and SEZ.
The stock listed at 770 on the NSE against an issue price of 440 and even hit a high of 1100 rupees. Most of the analysts are valuing it as per sum-of-parts valuation because this is going to be a mix of a port, Coal Terminal-II and an SEZ.
So the valuations turn out to be thus:
Mundra - Port & SEZ
DCF Value - Per Shr
Port - 149.63
CT-II - 62.34
SEZ - 187.03
The SEZ has been largely valued on the Phase I that they have which is only 15, 665 acres. The other 16, 000-odd acres are in transition. But most analysts are valuing the SEZ, as a whole – that is 30, 000 acres and giving the SEZ, a higher, greater valuation.
Also, the business plan has not been put in the RHP and CNBC-TV18’s discussions with the management. They are drawing out the business plans right now. But once more details come, more incremental value can be added to the SEZ.
Right now it works out to be Rs 399 per share, which is the lower level that is coming out on the Street. More optimistic figures are coming around Rs 450- Rs 500 per share.
How does it work out at Rs 1000 per share? It would be looking at 114 times FY08 earnings and 71 times FY09 earnings. Even on an earnings/ EBIDTA basis, where the EBIDTA is expected to increase in FY08 and FY09 because of new deals that they have struck, on an FY08 basis, EV/ EBIDTA, it would be 96 times and on FY09, it would be 73 times.
There is a lot of optimism going towards the SEZ. A lot of analysts are cautioning that the SEZ blueprint needs to be seen. See if the Phase I is a success and then attribute value towards the Phase II, and the land has to come into hand.
That’s what must be watched out for, as per CNBC-TV18 analysis.
Source: Moneycontrol.com
The stock listed at 770 on the NSE against an issue price of 440 and even hit a high of 1100 rupees. Most of the analysts are valuing it as per sum-of-parts valuation because this is going to be a mix of a port, Coal Terminal-II and an SEZ.
So the valuations turn out to be thus:
Mundra - Port & SEZ
DCF Value - Per Shr
Port - 149.63
CT-II - 62.34
SEZ - 187.03
The SEZ has been largely valued on the Phase I that they have which is only 15, 665 acres. The other 16, 000-odd acres are in transition. But most analysts are valuing the SEZ, as a whole – that is 30, 000 acres and giving the SEZ, a higher, greater valuation.
Also, the business plan has not been put in the RHP and CNBC-TV18’s discussions with the management. They are drawing out the business plans right now. But once more details come, more incremental value can be added to the SEZ.
Right now it works out to be Rs 399 per share, which is the lower level that is coming out on the Street. More optimistic figures are coming around Rs 450- Rs 500 per share.
How does it work out at Rs 1000 per share? It would be looking at 114 times FY08 earnings and 71 times FY09 earnings. Even on an earnings/ EBIDTA basis, where the EBIDTA is expected to increase in FY08 and FY09 because of new deals that they have struck, on an FY08 basis, EV/ EBIDTA, it would be 96 times and on FY09, it would be 73 times.
There is a lot of optimism going towards the SEZ. A lot of analysts are cautioning that the SEZ blueprint needs to be seen. See if the Phase I is a success and then attribute value towards the Phase II, and the land has to come into hand.
That’s what must be watched out for, as per CNBC-TV18 analysis.
Source: Moneycontrol.com
Experts say don't apply for Burnpur Cement IPO
Burnpur Cement proposes to enter capital market to raise Rs 26.20 crore to part-finance a clinkerisation and cement grinding plant in Jharkhand.
The company is offering 20.8 million shares, or 48.39 per cent of its pre-issue paid up caital, at a price of Rs 12 per share. The issue would open on November 28 and close on December 3.
The proceeds of the issue would be used to part-finance setting up of a 800 TPD clinkerisation and cement grinding plant in Jharkhand at a cost of Rs 120 crore. The plant is expected to go on stream from 2008-end. The remainder amount would be funded through debt and internal accruals.
Burnpur Cement currently produces 0.3 million tonnes of cement annually at its plant in West Bengal.
SREI Capital markets is the lead manager of the issue.
Source: Moneycontrol.com
The company is offering 20.8 million shares, or 48.39 per cent of its pre-issue paid up caital, at a price of Rs 12 per share. The issue would open on November 28 and close on December 3.
The proceeds of the issue would be used to part-finance setting up of a 800 TPD clinkerisation and cement grinding plant in Jharkhand at a cost of Rs 120 crore. The plant is expected to go on stream from 2008-end. The remainder amount would be funded through debt and internal accruals.
Burnpur Cement currently produces 0.3 million tonnes of cement annually at its plant in West Bengal.
SREI Capital markets is the lead manager of the issue.
Source: Moneycontrol.com
You may exit Kolte-Patil IPO if you wish
Sebi has asked Kolte-Patil to give option to all investors to withdraw application from IPO, reports CNBC-TV18.
Kolte-Patil has said that all investors have an option to withdraw application, if they desire, by December 4. The Sebi direction follows litigation in relation to the project, ‘Whispering Meadows II’. Kolte-Patil was to use part of the proceed for ‘Whispering Meadows II.
Kolte-Patil IPO was priced at Rs 125-145 and the IPO closed on November 22.
Girish Lakhe, Group CFO, Kolte-Patil Developers said that they have not seen any QIB or HNI pull out yet. Lakhe added that Kolte-Patil has the first right of ownership of 14,400 square feet of land. The company will write letters to all subscribers to the issue clarifying the matter, stated Lakhe.
Excerpts from CNBC-TV18’s exclusive interview with Girish Lakhe:
Q: Would you confirm that you have received a Sebi notice to allow withdrawals from your IPO?
A: We have received the notice from Mr Shastri, who sent a notice to us and to Sebi. Sebi has written a letter to us that we should give clarification on the notice and publish that in the newspapers and we have already done that. It has also given us an opportunity to write letters to all the people, who have subscribed to this IPO.
So, we are doing that. Basically, we have already published the notice and given the answers to Mr Shastri’s allegations. That was already published in the newspaper on Sunday. In the next three-four days, we have to write letters to all the subscribers of the issue to clarify the same thing, which has been explained in the advertisement.
Q: Could you just walk through the status of the litigation, as it stands for now, with regards to the project Whispering Meadows II?
A: The litigation is that there was a dispute between us and the NTI Society, which is a Bangalore-based society. We were supposed to deliver some 35,000 square feet of area to them, out of which we had already delivered 20,500 square feet.
The balance area was supposed to be 14,400 square feet, which we were supposed to deliver in phase II of this project. It was linked to some obligation that NTI has to perform. So, only 14,400 square feet is to be delivered to them.
But in the meantime, the NTI society conveyed the same property to Shastri, which was earlier conveyed to us. Then, there was arbitration between NTI and Shastri and the Supreme Court asked NTI to pay Rs 3.5 crore to Shastri to settle this dispute, which NTI did not do and Rs 3.5 crore was deposited in Supreme Court by us.
Q: So the point of contention right now is the 14,400 square feet of land. Who has ownership of this?
A: We have the first right of development on that. We have the ownership on that and we have to deliver this 14,400 square feet in phase II to NTI.
Q: Your issue was heavily oversubscribed on the QIB and HNI side. Since you have come out with this notice on the National Stock Exchange, have you got any QIB or High Net Worth individuals who have invested in IPO, who have already pulled out, apart from retail investors or does that part of the subscription remains untouched?
A: So far, no QIB has pulled out and no HNI has pulled out. There are some enquiries coming from the retail investors and we are already replying to them.
Source: Moneycontrol.com
Kolte-Patil has said that all investors have an option to withdraw application, if they desire, by December 4. The Sebi direction follows litigation in relation to the project, ‘Whispering Meadows II’. Kolte-Patil was to use part of the proceed for ‘Whispering Meadows II.
Kolte-Patil IPO was priced at Rs 125-145 and the IPO closed on November 22.
Girish Lakhe, Group CFO, Kolte-Patil Developers said that they have not seen any QIB or HNI pull out yet. Lakhe added that Kolte-Patil has the first right of ownership of 14,400 square feet of land. The company will write letters to all subscribers to the issue clarifying the matter, stated Lakhe.
Excerpts from CNBC-TV18’s exclusive interview with Girish Lakhe:
Q: Would you confirm that you have received a Sebi notice to allow withdrawals from your IPO?
A: We have received the notice from Mr Shastri, who sent a notice to us and to Sebi. Sebi has written a letter to us that we should give clarification on the notice and publish that in the newspapers and we have already done that. It has also given us an opportunity to write letters to all the people, who have subscribed to this IPO.
So, we are doing that. Basically, we have already published the notice and given the answers to Mr Shastri’s allegations. That was already published in the newspaper on Sunday. In the next three-four days, we have to write letters to all the subscribers of the issue to clarify the same thing, which has been explained in the advertisement.
Q: Could you just walk through the status of the litigation, as it stands for now, with regards to the project Whispering Meadows II?
A: The litigation is that there was a dispute between us and the NTI Society, which is a Bangalore-based society. We were supposed to deliver some 35,000 square feet of area to them, out of which we had already delivered 20,500 square feet.
The balance area was supposed to be 14,400 square feet, which we were supposed to deliver in phase II of this project. It was linked to some obligation that NTI has to perform. So, only 14,400 square feet is to be delivered to them.
But in the meantime, the NTI society conveyed the same property to Shastri, which was earlier conveyed to us. Then, there was arbitration between NTI and Shastri and the Supreme Court asked NTI to pay Rs 3.5 crore to Shastri to settle this dispute, which NTI did not do and Rs 3.5 crore was deposited in Supreme Court by us.
Q: So the point of contention right now is the 14,400 square feet of land. Who has ownership of this?
A: We have the first right of development on that. We have the ownership on that and we have to deliver this 14,400 square feet in phase II to NTI.
Q: Your issue was heavily oversubscribed on the QIB and HNI side. Since you have come out with this notice on the National Stock Exchange, have you got any QIB or High Net Worth individuals who have invested in IPO, who have already pulled out, apart from retail investors or does that part of the subscription remains untouched?
A: So far, no QIB has pulled out and no HNI has pulled out. There are some enquiries coming from the retail investors and we are already replying to them.
Source: Moneycontrol.com
Mundra Port ends with 118% premium
It was a phenomenal listing of Mundra Port and Special Economic Zone, India's largest non-government cargo terminal, which closed the day at Rs 959, a premium of 117.95% over its offer price of Rs 440 on the NSE. The share opened at Rs 770 and hit a high of Rs 1050. It traded with volumes of 2,72,94,366 shares and turnover at Rs 2,688 crore.
In an interview with CNBC-TV18, Ameet Desai, ED, Mundra Port & SEZ said they would be able to sustain CAGR of a high 30%. Coal and crude will contribute to a large part of the growth, almost 50-60%, going forward.
Container cargo, fertiliser, minerals, steel products are also seen as drivers.
They see small stream of SEZ revenues this year onwards.
The stock rose to a high of Rs 1150 before ending the day at Rs 961.70 on the BSE. It traded with volumes of 1,48,06,215 shares.
Sebi has denied permission to Mundra Port to trade in futures and options (F&O) segment.
The company had entered capital market with an IPO of 40.25 million shares and got subscribed 115.84 times. The company raised Rs 1771 crore from the market.
The objects of the issue were to part financing of construction and development of basic infrastructure and the allied facilities in the proposed SEZ at Mundra; construction and development of a terminal for coal and other cargo at Mundra Port; contribution towards investment in Adani Petronet (Dahej) Port Private Limited; contribution towards investment in Adani Logistics Limited; contribution towards investment in Inland Conware Private Limited and general corporate purposes.
Source: Moneycontrol.com
In an interview with CNBC-TV18, Ameet Desai, ED, Mundra Port & SEZ said they would be able to sustain CAGR of a high 30%. Coal and crude will contribute to a large part of the growth, almost 50-60%, going forward.
Container cargo, fertiliser, minerals, steel products are also seen as drivers.
They see small stream of SEZ revenues this year onwards.
The stock rose to a high of Rs 1150 before ending the day at Rs 961.70 on the BSE. It traded with volumes of 1,48,06,215 shares.
Sebi has denied permission to Mundra Port to trade in futures and options (F&O) segment.
The company had entered capital market with an IPO of 40.25 million shares and got subscribed 115.84 times. The company raised Rs 1771 crore from the market.
The objects of the issue were to part financing of construction and development of basic infrastructure and the allied facilities in the proposed SEZ at Mundra; construction and development of a terminal for coal and other cargo at Mundra Port; contribution towards investment in Adani Petronet (Dahej) Port Private Limited; contribution towards investment in Adani Logistics Limited; contribution towards investment in Inland Conware Private Limited and general corporate purposes.
Source: Moneycontrol.com
Monday, November 26, 2007
Mundra Port does not look expensive
CNBC-TV18’s research analyst, Kanchi Gandhi: An excellent subscription for Mundra Port, nearly 115 times. The HNI portion was subscribed 153 times, the QIB 159 times. On the subscription basis, it was very good subscription for this one. The issue price was at Rs 440, the grey market premium around Rs 550 which means that we can expect a listing of around Rs 1,000.
The important thing is the valuation; if one looks at some of the parts valuations for the company we have got three major segments - the port, the SEZ and CT-II. We are looking at on a very conservative basis and some of the part valuations of around Rs 399 and it gets around 48% to 49% of it’s valuations from the SEZ portion, around 40% from the port and the CT-II segment just contributes around Rs 62 per share. So on a very conservative basis we are looking at some of part valuations at around Rs 399 per share.
Most analysts are expecting it little bit higher than the CLSA, which put some of the valuations of around Rs 445 per share and some going even higher. But we might see rerating and more clarity will come in as we see more details coming in on how much revenues will be from each of the revenue segment. So once that comes in there will be more clarity on this segmental valuation break-up. Looking at the financial, we are expecting for the FY08 revenues of around Rs 814 crore mark, FY09 somewhere around the Rs 1,100 crore mark.
Looking at an EPS of FY08 of Rs 8.7 and for FY09 around Rs 14 mark. So it is trading at roughly at Rs 50-51 times FY08 and around Rs 31 times FY09. If one looks at the listed players in India we have got nothing that comes close to is such a vastly varied company segment. The closest is Sical Logistic but on the global player basis some of the Chinese ports are trading at around PE 37 calendar year FY07 earnings and around 30 times FY08 earnings. On that basis it is not looking all that expensive, very good subscription, at around Rs 550 grey market premium; we are expecting listing of around Rs 1,000.
Source: Moneycontrol.com
The important thing is the valuation; if one looks at some of the parts valuations for the company we have got three major segments - the port, the SEZ and CT-II. We are looking at on a very conservative basis and some of the part valuations of around Rs 399 and it gets around 48% to 49% of it’s valuations from the SEZ portion, around 40% from the port and the CT-II segment just contributes around Rs 62 per share. So on a very conservative basis we are looking at some of part valuations at around Rs 399 per share.
Most analysts are expecting it little bit higher than the CLSA, which put some of the valuations of around Rs 445 per share and some going even higher. But we might see rerating and more clarity will come in as we see more details coming in on how much revenues will be from each of the revenue segment. So once that comes in there will be more clarity on this segmental valuation break-up. Looking at the financial, we are expecting for the FY08 revenues of around Rs 814 crore mark, FY09 somewhere around the Rs 1,100 crore mark.
Looking at an EPS of FY08 of Rs 8.7 and for FY09 around Rs 14 mark. So it is trading at roughly at Rs 50-51 times FY08 and around Rs 31 times FY09. If one looks at the listed players in India we have got nothing that comes close to is such a vastly varied company segment. The closest is Sical Logistic but on the global player basis some of the Chinese ports are trading at around PE 37 calendar year FY07 earnings and around 30 times FY08 earnings. On that basis it is not looking all that expensive, very good subscription, at around Rs 550 grey market premium; we are expecting listing of around Rs 1,000.
Source: Moneycontrol.com
Mundra Port to list on Tuesday
After receiving overwhelming response to public issue, Mundra Port and Special Economic Zone, India's largest non-government cargo terminal, will list on the bourses on November 27, 2007. The offer price has been fixed at Rs 440 per share.
The company had entered capital market with an IPO of 40.25 million shares and got subscribed 115.84 times.
Public issue of Mundra Port has seen commitment for bids worth USD 51.5 billion and QIBs applied for USD 42.83 billion worth of shares. Total amount of money received in IPO was at USD 13 billion as against actual issue size of USD 450 million.
The Adani Group, founder of Mundra Port, has interests in commodities trading, coal mining, power generation, real estate development and agriculture processing.
Source: Moneycontrol.com
The company had entered capital market with an IPO of 40.25 million shares and got subscribed 115.84 times.
Public issue of Mundra Port has seen commitment for bids worth USD 51.5 billion and QIBs applied for USD 42.83 billion worth of shares. Total amount of money received in IPO was at USD 13 billion as against actual issue size of USD 450 million.
The Adani Group, founder of Mundra Port, has interests in commodities trading, coal mining, power generation, real estate development and agriculture processing.
Source: Moneycontrol.com
Sebi denies permission to Mundra Port to trade in F&O
CNBC-TV18 has learnt that Sebi has denied permission to Mundra Port to trade in the F&O segment.
Mundra Port will list on the BSE and NSE cash markets on Tuesday.
Source: Moneycontrol.com
Mundra Port will list on the BSE and NSE cash markets on Tuesday.
Source: Moneycontrol.com
Mundra will see Rs 1000 + on listing
After getting good response to initial public offer, Mundra Port and Special Economic Zone, developer and operator of the Mundra Port, one of the leading non-captive private sector ports in India based on volume of cargo during fiscal 2007, will list on the bourses on Tuesday, November 27. The offer price has been fixed at Rs 440 per share.
Market ended with hefty gains today. Experts are gung ho about the Mundra story. They are expecting the stock to list at around Rs 1000-1200 and advised to hold for long term. IPO oversubscription figures also added to positive sentiment as it got over subscribed 160 times.
Mundra Port will list on the BSE and NSE cash markets. Sebi has denied permission to Mundra Port to trade in futures and options (F&O) segment, according to sources.
R S Iyer of K R Choksey Securities said, "Mundra Port is expected to list above Rs 1000. People, who have capacity to hold for better price, they should hold stock for long term. Otherwise, any price above Rs 1000, one can book profits."
According to Investment Advisor, S P Tulsian, "Mundra Port is likely to list at Rs 1,100 per share against issue price of Rs 440. Investors are advised to hold, as good investment buying would be seen in the counter."
"The stock will list in the band of Rs 1000-1200. One should do partial profit booking and remain invested in balance shares till the company gets approval to its SEZ near its port", said Manish Bhatt of Prabhudas Lilladher.
"MPSEZ is one of the first port-based multi-product SEZs in India. Also the company has a huge land bank for development following its mergers with ACL, MSEZ and APL which would lead to higher volumes of cargo in the port. The Stock will be listed with good premium. Investors may book partial profits and are advice to hold the remaining shares for the long term benefit", said Arihant Capital, Head of Research, Arpit Agrawal.
The company had entered capital market with an IPO of 40,250,000 equity shares of Rs 10 each for cash at a price band of Rs 400-440 per equity share.
The objects of the issue are to part financing of construction and development of basic infrastructure and the allied facilities in the proposed SEZ at Mundra; construction and development of a terminal for coal and other cargo at Mundra Port; contribution towards investment in Adani Petronet (Dahej) Port Private Limited; contribution towards investment in Adani Logistics Limited; contribution towards investment in Inland Conware Private Limited and general corporate purposes.
The global co-ordinators and book running lead managers to the issue are: DSP Merrill Lynch Limited, JM Financial Consultants Private Limited and SSKI Corporate Finance Limited. The book running lead mangers to the issue are Enam Securities Private Limited, Kotak Mahindra Capital Company Limited, ICICI Securities Limited and SBI Capital Markets Limited.
Source: Moneycontrol.com
Market ended with hefty gains today. Experts are gung ho about the Mundra story. They are expecting the stock to list at around Rs 1000-1200 and advised to hold for long term. IPO oversubscription figures also added to positive sentiment as it got over subscribed 160 times.
Mundra Port will list on the BSE and NSE cash markets. Sebi has denied permission to Mundra Port to trade in futures and options (F&O) segment, according to sources.
R S Iyer of K R Choksey Securities said, "Mundra Port is expected to list above Rs 1000. People, who have capacity to hold for better price, they should hold stock for long term. Otherwise, any price above Rs 1000, one can book profits."
According to Investment Advisor, S P Tulsian, "Mundra Port is likely to list at Rs 1,100 per share against issue price of Rs 440. Investors are advised to hold, as good investment buying would be seen in the counter."
"The stock will list in the band of Rs 1000-1200. One should do partial profit booking and remain invested in balance shares till the company gets approval to its SEZ near its port", said Manish Bhatt of Prabhudas Lilladher.
"MPSEZ is one of the first port-based multi-product SEZs in India. Also the company has a huge land bank for development following its mergers with ACL, MSEZ and APL which would lead to higher volumes of cargo in the port. The Stock will be listed with good premium. Investors may book partial profits and are advice to hold the remaining shares for the long term benefit", said Arihant Capital, Head of Research, Arpit Agrawal.
The company had entered capital market with an IPO of 40,250,000 equity shares of Rs 10 each for cash at a price band of Rs 400-440 per equity share.
The objects of the issue are to part financing of construction and development of basic infrastructure and the allied facilities in the proposed SEZ at Mundra; construction and development of a terminal for coal and other cargo at Mundra Port; contribution towards investment in Adani Petronet (Dahej) Port Private Limited; contribution towards investment in Adani Logistics Limited; contribution towards investment in Inland Conware Private Limited and general corporate purposes.
The global co-ordinators and book running lead managers to the issue are: DSP Merrill Lynch Limited, JM Financial Consultants Private Limited and SSKI Corporate Finance Limited. The book running lead mangers to the issue are Enam Securities Private Limited, Kotak Mahindra Capital Company Limited, ICICI Securities Limited and SBI Capital Markets Limited.
Source: Moneycontrol.com
Sunday, November 25, 2007
Allied Comp plans to launch Rs 15K laptops
Allied Computers International, a Mumbai based IT hardware company, has listed at Rs 21, a premium of 75% over its offer price of Rs 12.
The company had come out with a public issue to raise at around Rs 6 crore with fixed price of Rs 12 per share (the face value of Rs 10 each).
Allied Computers offers cheaper laptops and manufactures notebook computer for Rs 19,999. The company has planned to launch compact laptop costing Rs 15,000 by mid-2008 and will open its own showrooms all over India and enter into tie-ups with supermarkets or malls and retail showroom franchisees. The company has planned to set up a manufacturing unit exclusively for laptops in Thane district and to increase production from existing 10,000 laptops to 100,000 per year.
HK Patel, Managing Director of Allied Computers International said that he is looking at launching laptops at Rs 15000 and computers below Rs 30,000. His FY08 sales target is Rs 70 crore and for FY09, it is at Rs 200 crore.
Excerpts from CNBC-TV18’s exclusive interview with HK Patel:
Q: What exactly is your plan with manufacturing laptops and notebook computers, what kind of capacity are you looking at and pricing?
A: Basically we are looking at pricing below the current pricing, which we are offering at Rs 30,000. So we have just announced about a month ago that we will be launching a laptop of about Rs 15,000. This means that we will have to increase our capacity to at least ten folds of what we have today.
Q: Who do you have a technical collaboration with because this is the market which is dominated by a lot of international players and then unorganized players?
A: We, as a company are a research-based company also and we have a technical collaboration with few Tier I and Tier II manufacturers directly from China and Taiwan. We have been working with those companies for last five years and I being a technical person, I have been consulting for hardware companies since 1992.
That basically has enabled us to establish relationship with the laptop manufacturers in the Far East. Due to those reasons ,we have consistently been able to launch high tech, high performance equipments at lower prices and now we are moving into a next phase of designing our own laptop, which will fit the budget of most people in the country.
Q: Is there a market share that you hold right now that you could talk about and with these new introductions we estimate that you will do about 200 crore next year in sells, is that a doable target?
A: When I say next year, I do not mean financial year 2008. I am talking about 2009 and our targeted turnover for March-ending 2008 is about 70 crore because obviously, that year is almost ending. Now the Rs 200 crore target is for March-ending 2009 and I believe that we will easily by far exceed it; that is the minimum target we are aiming for the moment.
Source: Moneycontrol.com
The company had come out with a public issue to raise at around Rs 6 crore with fixed price of Rs 12 per share (the face value of Rs 10 each).
Allied Computers offers cheaper laptops and manufactures notebook computer for Rs 19,999. The company has planned to launch compact laptop costing Rs 15,000 by mid-2008 and will open its own showrooms all over India and enter into tie-ups with supermarkets or malls and retail showroom franchisees. The company has planned to set up a manufacturing unit exclusively for laptops in Thane district and to increase production from existing 10,000 laptops to 100,000 per year.
HK Patel, Managing Director of Allied Computers International said that he is looking at launching laptops at Rs 15000 and computers below Rs 30,000. His FY08 sales target is Rs 70 crore and for FY09, it is at Rs 200 crore.
Excerpts from CNBC-TV18’s exclusive interview with HK Patel:
Q: What exactly is your plan with manufacturing laptops and notebook computers, what kind of capacity are you looking at and pricing?
A: Basically we are looking at pricing below the current pricing, which we are offering at Rs 30,000. So we have just announced about a month ago that we will be launching a laptop of about Rs 15,000. This means that we will have to increase our capacity to at least ten folds of what we have today.
Q: Who do you have a technical collaboration with because this is the market which is dominated by a lot of international players and then unorganized players?
A: We, as a company are a research-based company also and we have a technical collaboration with few Tier I and Tier II manufacturers directly from China and Taiwan. We have been working with those companies for last five years and I being a technical person, I have been consulting for hardware companies since 1992.
That basically has enabled us to establish relationship with the laptop manufacturers in the Far East. Due to those reasons ,we have consistently been able to launch high tech, high performance equipments at lower prices and now we are moving into a next phase of designing our own laptop, which will fit the budget of most people in the country.
Q: Is there a market share that you hold right now that you could talk about and with these new introductions we estimate that you will do about 200 crore next year in sells, is that a doable target?
A: When I say next year, I do not mean financial year 2008. I am talking about 2009 and our targeted turnover for March-ending 2008 is about 70 crore because obviously, that year is almost ending. Now the Rs 200 crore target is for March-ending 2009 and I believe that we will easily by far exceed it; that is the minimum target we are aiming for the moment.
Source: Moneycontrol.com
Kaushalya Infra IPO subscribed 7 times
The initial public offering of 85 lakh shares of Kaushalya Infrastructure Development Corporation has received good response; subscribed 7.2 times, till 5 pm, according to data available on NSE website.
The price band is between Rs 50 and Rs 60. The equity shares are proposed to be listed on the BSE and NSE.
Public issue has received bids for 6.12 crore shares as against 85 lakh shares on offer and bids for 2.69 lakh shares at cut off price.
The company will use the proceeds from the issue to fund land acquisition, land development rights and real estate development, investment in BOT/BOOT projects for joint ventures, and purchase of capital and infrastructure equipment for the execution of projects.
This net issue would constitute 40.93 per cent of the fully diluted post-issue paid-up capital of the company.
SREI Capital Markets Ltd will be the lead managers of the issue and Intime Spectrum Registry Ltd the registrar.
Source: Moneycontrol.com
The price band is between Rs 50 and Rs 60. The equity shares are proposed to be listed on the BSE and NSE.
Public issue has received bids for 6.12 crore shares as against 85 lakh shares on offer and bids for 2.69 lakh shares at cut off price.
The company will use the proceeds from the issue to fund land acquisition, land development rights and real estate development, investment in BOT/BOOT projects for joint ventures, and purchase of capital and infrastructure equipment for the execution of projects.
This net issue would constitute 40.93 per cent of the fully diluted post-issue paid-up capital of the company.
SREI Capital Markets Ltd will be the lead managers of the issue and Intime Spectrum Registry Ltd the registrar.
Source: Moneycontrol.com
Friday, November 23, 2007
Jyothy Labs well placed for healthy growth
India Infoline has come out with research report on Jyothy Laboratories IPO. The firm has recommended subscribing to the issue.
Jyothy Laboratories has opened for subscription with an initial public offering (IPO) of 44.30 lakh shares of Rs 5 each at a price band between Rs 620 and Rs 690 per equity share.
The company will raise Rs 274 at lower price band and Rs 305.6 crore at higher end of price band. The issue will close on November 27, 2007.
India Infoline report on Jyothy Laboratories IPO
Jyothy Laboratories (JLL) is an FMCG company making a range of branded products, including fabric whiteners, mosquito repellents, dish-washing soaps, soaps and incense. Its key brands are Ujala, Maxo, Exo, Jeeva and Maya.
Investment summary
* Ujala is a well-known brand of fabric whitener, with dominant market share of approximately 72% in the category
* Local presence and wide distribution reach
* Targets the rural market
* Entering into new joint-venture initiatives
Risks and concerns
* Heavily depend on two biggest brands, Ujala and Maxo which contribute 43.6% and 35.4% of its total sales respectively (as on 30 June 2007).
* Dependence on outsourced production through third parties. Any disputes or disagreements may affect their business.
* The company is susceptible to seasonal variations in demand for its products.
Valuations attractive in comparison to the peer group
At the issue price of Rs 620-690, JLL commands an inexpensive P/E (on relative basis) of 18.6x-20.7x based on FY07 EPS of Rs 33.3. The price/book ratio of 3.4x at Rs 690 is also at steep discount to peers. The company is well-placed for healthy growth, given its well-established brand equity, leadership in the fabric whitener segment and strategic alliances. We recommend to Subscribe in the issue.
Source: Moneycontrol.com
Jyothy Laboratories has opened for subscription with an initial public offering (IPO) of 44.30 lakh shares of Rs 5 each at a price band between Rs 620 and Rs 690 per equity share.
The company will raise Rs 274 at lower price band and Rs 305.6 crore at higher end of price band. The issue will close on November 27, 2007.
India Infoline report on Jyothy Laboratories IPO
Jyothy Laboratories (JLL) is an FMCG company making a range of branded products, including fabric whiteners, mosquito repellents, dish-washing soaps, soaps and incense. Its key brands are Ujala, Maxo, Exo, Jeeva and Maya.
Investment summary
* Ujala is a well-known brand of fabric whitener, with dominant market share of approximately 72% in the category
* Local presence and wide distribution reach
* Targets the rural market
* Entering into new joint-venture initiatives
Risks and concerns
* Heavily depend on two biggest brands, Ujala and Maxo which contribute 43.6% and 35.4% of its total sales respectively (as on 30 June 2007).
* Dependence on outsourced production through third parties. Any disputes or disagreements may affect their business.
* The company is susceptible to seasonal variations in demand for its products.
Valuations attractive in comparison to the peer group
At the issue price of Rs 620-690, JLL commands an inexpensive P/E (on relative basis) of 18.6x-20.7x based on FY07 EPS of Rs 33.3. The price/book ratio of 3.4x at Rs 690 is also at steep discount to peers. The company is well-placed for healthy growth, given its well-established brand equity, leadership in the fabric whitener segment and strategic alliances. We recommend to Subscribe in the issue.
Source: Moneycontrol.com
Empee Distilleries to list around Rs 430-500
Chennai based, Empee Distilleries will list on the bourses on Monday, November 26, 2007. The offer price has been fixed at Rs 400 per share.
Investment Advisor, S P Tulsian said, "Empee Distilleries is likely to list at Rs 430 as against the issue price of Rs 400. Buying is advised upto Rs 430 while profit booking may be made above Rs 450. Share is a good bet for medium term."
"Empee is expected to list at around Rs 450-500. One should book profits", according to R S Iyer of K R Choksey Securities.
The company had entered capital market with a public issue of 48,00,000 shares of Rs 10 each priced Rs 350-400 per share and its issue had subscribed 6.87 times.
It proposed to part-finance its expansion from the net proceeds. The company plans to set up 60 klpd grain based distillery and blending & bottling Indian-made-foreign-liquor plant with capacity of 0.07 lakh cases per month in Nellore, Andhra Pradesh. It plans to expand the existing distillery in Mevalorkuppam.
The company will also set up 7.5 MW biomass based power plant in Aranthangi, and develop 2 lakh square feet of residential space at Mevalorkuppam, in Tamil Nadu.
Source: Moneycontrol.com
Investment Advisor, S P Tulsian said, "Empee Distilleries is likely to list at Rs 430 as against the issue price of Rs 400. Buying is advised upto Rs 430 while profit booking may be made above Rs 450. Share is a good bet for medium term."
"Empee is expected to list at around Rs 450-500. One should book profits", according to R S Iyer of K R Choksey Securities.
The company had entered capital market with a public issue of 48,00,000 shares of Rs 10 each priced Rs 350-400 per share and its issue had subscribed 6.87 times.
It proposed to part-finance its expansion from the net proceeds. The company plans to set up 60 klpd grain based distillery and blending & bottling Indian-made-foreign-liquor plant with capacity of 0.07 lakh cases per month in Nellore, Andhra Pradesh. It plans to expand the existing distillery in Mevalorkuppam.
The company will also set up 7.5 MW biomass based power plant in Aranthangi, and develop 2 lakh square feet of residential space at Mevalorkuppam, in Tamil Nadu.
Source: Moneycontrol.com
BSNL to launch an IPO next year
State-owned telecom firm, BSNL could come out with an initial public offer within the next one year. The idea behind the stock market listing is not so much to raise capital, as to put a value to the company, reports CNBC-TV18.
It could well be the mother of all Indian IPOs, if it happens at all. Caution is warranted because this is not the first time that state-owned Bharat Sanchar Nigam is considering an IPO. A top company official said one could expect it over the next 6-12 months.
It has been learnt that 20% of equity might be on offer. The valuations border on the fantastic. A company finance official quoted a figure of USD 100 billion. That is almost double the value of Bharti Airtel, whose market cap is about USD 45 billion. And Anil Ambani-owned Reliance Communications is valued at USD 35 billion.
BSNL has a much wider network and boasts of 65 million subscribers. Many of them are fixedline customers, who run up higher phone bills on an average than mobile users. Over the last 6-8 months, BSNL's performance has been muted on account of capacity constraints, but it is trying to get the better of market leader Bharti Airtel.
According to Kuldip Goyal, CMD, BSNL, “In about two months from now, Ericsson’s supply of equipment will start after that we should also be easily hitting the two million figure." The company is in the process of cleaning up its books and is likely to appoint an advisor to the IPO soon.
The company's previous attempt at a stock market listing did not take off because the previous Telecom Minister, Dayanidhi Maran, was not in favour of it. But current Minister A Raja is said to be not averse. The idea behind the stock market flotation is to discover the value of the company, not so much to raise capital.
Source: Moneycontrol.com
It could well be the mother of all Indian IPOs, if it happens at all. Caution is warranted because this is not the first time that state-owned Bharat Sanchar Nigam is considering an IPO. A top company official said one could expect it over the next 6-12 months.
It has been learnt that 20% of equity might be on offer. The valuations border on the fantastic. A company finance official quoted a figure of USD 100 billion. That is almost double the value of Bharti Airtel, whose market cap is about USD 45 billion. And Anil Ambani-owned Reliance Communications is valued at USD 35 billion.
BSNL has a much wider network and boasts of 65 million subscribers. Many of them are fixedline customers, who run up higher phone bills on an average than mobile users. Over the last 6-8 months, BSNL's performance has been muted on account of capacity constraints, but it is trying to get the better of market leader Bharti Airtel.
According to Kuldip Goyal, CMD, BSNL, “In about two months from now, Ericsson’s supply of equipment will start after that we should also be easily hitting the two million figure." The company is in the process of cleaning up its books and is likely to appoint an advisor to the IPO soon.
The company's previous attempt at a stock market listing did not take off because the previous Telecom Minister, Dayanidhi Maran, was not in favour of it. But current Minister A Raja is said to be not averse. The idea behind the stock market flotation is to discover the value of the company, not so much to raise capital.
Source: Moneycontrol.com
Thursday, November 22, 2007
Kolte-Patil IPO subscribed 45 times
The initial public offering (IPO) of Kolte-Patil Developers, a real estate developer in India, has got terrific respone from investors; subscribed 45 times, till 5 pm, according to data available on NSE website.
It received bids for 86 crore equity shares as against 1.9 crore shares on offer and bids for 8.7 crore shares at cut off price.
The company entered capital market with an public issue of 19,000,836 equity shares of Rs 10 each for cash at a price band between Rs 125 and Rs 145 per equity share.
The objects of the issue are to finance acquisition of development rights; finance the construction and development costs for some of the proposed projects; fund expenditure for general corporate purposes and achieve the benefits of listing on the Stock Exchange.
The issue comprises a net issue of 18,812,709 equity shares to the public and a reservation of 188,127 equity shares for eligible employees. The issue will constitute 25.25% while the net issue will constitute 25% respectively of the post-Issue paid up capital of the company. The equity shares are proposed to be listed on the NSE and BSE.
The book running lead managers to the issue are DSP Merrill Lynch Limited and Edelweiss Capital Limited.
Source: Moneycontrol.com
It received bids for 86 crore equity shares as against 1.9 crore shares on offer and bids for 8.7 crore shares at cut off price.
The company entered capital market with an public issue of 19,000,836 equity shares of Rs 10 each for cash at a price band between Rs 125 and Rs 145 per equity share.
The objects of the issue are to finance acquisition of development rights; finance the construction and development costs for some of the proposed projects; fund expenditure for general corporate purposes and achieve the benefits of listing on the Stock Exchange.
The issue comprises a net issue of 18,812,709 equity shares to the public and a reservation of 188,127 equity shares for eligible employees. The issue will constitute 25.25% while the net issue will constitute 25% respectively of the post-Issue paid up capital of the company. The equity shares are proposed to be listed on the NSE and BSE.
The book running lead managers to the issue are DSP Merrill Lynch Limited and Edelweiss Capital Limited.
Source: Moneycontrol.com
Rathi Bars to list on bourses tomorrow
Iron and steel maker, Rathi Bars will list on the bourses on Friday, November 23, 2007. Its BSE ID is 532918.
The company had entered capital markets with an initial public offering (IPO) of 71.42 lakh equity shares with a face value of Rs 10 each at fixed price of Rs 35 per share and raised around Rs 25 crore from the issue.
Promoters diluted 44% of holding through this public issue. The company has a production capacity of 70,000 tons per annum and that will increase it to one lakh tons per annum.
The company has earmarked an investment of Rs 35 crore for purchasing and upgrading its equipment and other expansion plans. The public issue will fund the bulk of the expansion programme. The rest of the fund will come from internal accruals and debt market.
Source: Moneycontrol.com
The company had entered capital markets with an initial public offering (IPO) of 71.42 lakh equity shares with a face value of Rs 10 each at fixed price of Rs 35 per share and raised around Rs 25 crore from the issue.
Promoters diluted 44% of holding through this public issue. The company has a production capacity of 70,000 tons per annum and that will increase it to one lakh tons per annum.
The company has earmarked an investment of Rs 35 crore for purchasing and upgrading its equipment and other expansion plans. The public issue will fund the bulk of the expansion programme. The rest of the fund will come from internal accruals and debt market.
Source: Moneycontrol.com
Barak Valley likely to list above Rs 60
Barak Valley Cements, a cement manufacturer in the north-east region, will list on the bourses on November 23, 2007.
R S Iyer of K R Choksey Securities said, "Barak Valley is expected to list at around Rs 60. One can start booking profits above Rs 80."
"Barak Valley is likely to get listed at Rs 63, as against the issue price of Rs 42. Profit booking is advised above Rs 60", according to Investment Advisor, S P Tulsian.
The company had entered the capital market with an initial public offer (IPO) of 56,60,000 equity shares of Rs 10 each for cash at a price of Rs 42 and its IPO was subscribed around 29 times.
The objects of the issue are to part finance expansion of clinkerisation capacity from present 420 TPD (tonnes per day) to 600 TPD, cement grinding capacity from 460 TPD to 750 TPD, investment in wholly owned subsidiary — Badarpur Energy (P) Ltd.; for setting up a 6 MW biomass based power project, to meet the working capital requirements and for general corporate purpose.
The book running lead manager to the Issue is UTI Securities Limited and the co- book running lead manager is Karvy Investor Services Limited.
Source: Moneycontrol.com
R S Iyer of K R Choksey Securities said, "Barak Valley is expected to list at around Rs 60. One can start booking profits above Rs 80."
"Barak Valley is likely to get listed at Rs 63, as against the issue price of Rs 42. Profit booking is advised above Rs 60", according to Investment Advisor, S P Tulsian.
The company had entered the capital market with an initial public offer (IPO) of 56,60,000 equity shares of Rs 10 each for cash at a price of Rs 42 and its IPO was subscribed around 29 times.
The objects of the issue are to part finance expansion of clinkerisation capacity from present 420 TPD (tonnes per day) to 600 TPD, cement grinding capacity from 460 TPD to 750 TPD, investment in wholly owned subsidiary — Badarpur Energy (P) Ltd.; for setting up a 6 MW biomass based power project, to meet the working capital requirements and for general corporate purpose.
The book running lead manager to the Issue is UTI Securities Limited and the co- book running lead manager is Karvy Investor Services Limited.
Source: Moneycontrol.com
Jyothy Labs may see 15-20% upside on listing
NBC-TV18’s stocks editor, Udayan Mukherjee - All of us know Jyothy Laboratories; Ujala is one of the biggest FMCG brands in the country. It is a large company, well established, good midcap FMCG play, well established brands in many categories. Essentially they are not raising money, but some of the venture capital private equity investors are making an offer for sale, so some investors getting out.
But even so in the price band of Rs 620-690, they have left something on the table assuming that they do Rs 58-60 earnings next year. The stock is coming at 11-12 PE for FY09, you will find that it is cheaper than FMCG players in the market not Hindustan Unilever. But even the midcaps stronger FMCG plays like Marico etc, Jyothy comes at a discount to that.
So fair value for the stock should be at Rs 800-850 zone in an ideal world, so they have left a little bit on the table. You can still hope for 15-20% upside for this issue. But its not one of those double on listings or treble on listing kind of candidates like Religare, the returns will be probably more modest, moderate about 20-25%, but good quality, good pedigree play.
Source: Moneycontrol.com
But even so in the price band of Rs 620-690, they have left something on the table assuming that they do Rs 58-60 earnings next year. The stock is coming at 11-12 PE for FY09, you will find that it is cheaper than FMCG players in the market not Hindustan Unilever. But even the midcaps stronger FMCG plays like Marico etc, Jyothy comes at a discount to that.
So fair value for the stock should be at Rs 800-850 zone in an ideal world, so they have left a little bit on the table. You can still hope for 15-20% upside for this issue. But its not one of those double on listings or treble on listing kind of candidates like Religare, the returns will be probably more modest, moderate about 20-25%, but good quality, good pedigree play.
Source: Moneycontrol.com
Wednesday, November 21, 2007
Subscribe to Jyothy Labs issue
Jyothy Laboratories is entering capital market with an initial public offering (IPO) of 44.30 lakh shares of Rs 5 each at a price band between Rs 620 and Rs 690 per equity share.
The company will raise Rs 274 at lower price band and Rs 305.6 crore at higher end of price band. The issue will open on November 22 and November 27, 2007.
The offer would constitute 30.52% of the post issue paid up capital of the company. Post issue, Jyothy Labs' promoters stake will remain at 69.47%. Its investors including Canzone Limited, ICICI Bank Canada, ICICI Bank UK PLC, South Asia Regional Fund and CDC Investment Holdings are selling their stakes through this offer.
The equity shares are proposed to be listed on the NSE and the BSE.
FMCG company is in the fabric care, household insecticide, surface cleaning, personal care and air care segments of the Indian market. It offers branded products including fabric whitener, mosquito repellent, dishwashing, bath and incense products.
Enam Securities Pvt Ltd and Kotak Mahindra Capita Company Ltd are book running lead managers and Intime Spectrum Registry Limited is the registrar to the issue.
Source: Moneycontrol.com
The company will raise Rs 274 at lower price band and Rs 305.6 crore at higher end of price band. The issue will open on November 22 and November 27, 2007.
The offer would constitute 30.52% of the post issue paid up capital of the company. Post issue, Jyothy Labs' promoters stake will remain at 69.47%. Its investors including Canzone Limited, ICICI Bank Canada, ICICI Bank UK PLC, South Asia Regional Fund and CDC Investment Holdings are selling their stakes through this offer.
The equity shares are proposed to be listed on the NSE and the BSE.
FMCG company is in the fabric care, household insecticide, surface cleaning, personal care and air care segments of the Indian market. It offers branded products including fabric whitener, mosquito repellent, dishwashing, bath and incense products.
Enam Securities Pvt Ltd and Kotak Mahindra Capita Company Ltd are book running lead managers and Intime Spectrum Registry Limited is the registrar to the issue.
Source: Moneycontrol.com
Religare to enter life insurance biz with Aegon
Malvinder Singh, Chairman, Religare Enterprises, said the company is open to more partnerships and acquisitions.
Singh said Religare Enterprises plans to enter into the life insurance business with Aegon.
Excerpts from CNBC-TV18’s exclusive interview with Malvinder Singh:
Q: What are your plans for the company? Are you now seeing it as full-fledged financial services company?
A: We have always viewed it as a full-fledged financial services company. This is really the beginning of growth of that company. The best is yet to come. There is lot of work and effort going towards creating a diversified fully integrated financial services play. We are extremely committed to making sure we become a leader in the financial services sector in India.
Q: Would the growth involve a lot of inorganic initiatives? Are you already talking to foreign or Indian partners either for takeovers or for joint ventures?
A: There are a lot of opportunities in that area. We have grown rapidly over the last few years and have developed some strong global strategic partnerships in different aspects of the business. We will always be open to exploring opportunities for more partnerships and acquisitions in India and internationally.
Q: At this point of time, would it be reasonable to assume that you are already in discussion with any players domestic or global?
A: We are always looking at strengthening our partnership and providing a better proposition of values in terms of products and services to our customers. There is a huge growth that we will continue to see in the services industry in India, particular in financial services. I would certainly like to believe that we are very well positioned at an extremely appropriate time to capitalize on those opportunities over the next few years.
Q: You have applied for an AMC sponsorship with Sebi along with the Aegon. Are there any such similar tie-up plans that you have at this stage to diversify the product portfolio beyond just institutional broking and investment banking, to take forward the step of becoming a pan India player?
A: We are a pan India player today and have a series of products and services across the different segments of the financial services spectrum. We will look at continuing to deepen our presence and strengthen the products and services that we are providing. We have a very strong pan India network of our services in terms of branches and activities that we have. That is a very strong foundation and base on which we will be able to build and add significant value for our customers as we move forward.
Q: Did it cross the group’s mind to set up a bank? Is that the final target which you are looking at? Is insurance anywhere on the radar?
A: Insurance is definitely there. We have a joint venture with Aegon. I will certainly hope that sometime early next year, we will be able to launch our life insurance venture. That is a very integral component of the financial services industry and our intention is to be a leader in that. Banking is a related and an integral part of the financial services world, but we need to take things one-step at a time.
Q: Beyond what was raised in the IPO for Religare, what sort of investment will this entity require between now and in the next couple of years, to bring through all these plans that you are mentioning?
A: There is a very well laid and thought out plan. We are acting on that step-by-step
Source: Moneycontrol.com
Singh said Religare Enterprises plans to enter into the life insurance business with Aegon.
Excerpts from CNBC-TV18’s exclusive interview with Malvinder Singh:
Q: What are your plans for the company? Are you now seeing it as full-fledged financial services company?
A: We have always viewed it as a full-fledged financial services company. This is really the beginning of growth of that company. The best is yet to come. There is lot of work and effort going towards creating a diversified fully integrated financial services play. We are extremely committed to making sure we become a leader in the financial services sector in India.
Q: Would the growth involve a lot of inorganic initiatives? Are you already talking to foreign or Indian partners either for takeovers or for joint ventures?
A: There are a lot of opportunities in that area. We have grown rapidly over the last few years and have developed some strong global strategic partnerships in different aspects of the business. We will always be open to exploring opportunities for more partnerships and acquisitions in India and internationally.
Q: At this point of time, would it be reasonable to assume that you are already in discussion with any players domestic or global?
A: We are always looking at strengthening our partnership and providing a better proposition of values in terms of products and services to our customers. There is a huge growth that we will continue to see in the services industry in India, particular in financial services. I would certainly like to believe that we are very well positioned at an extremely appropriate time to capitalize on those opportunities over the next few years.
Q: You have applied for an AMC sponsorship with Sebi along with the Aegon. Are there any such similar tie-up plans that you have at this stage to diversify the product portfolio beyond just institutional broking and investment banking, to take forward the step of becoming a pan India player?
A: We are a pan India player today and have a series of products and services across the different segments of the financial services spectrum. We will look at continuing to deepen our presence and strengthen the products and services that we are providing. We have a very strong pan India network of our services in terms of branches and activities that we have. That is a very strong foundation and base on which we will be able to build and add significant value for our customers as we move forward.
Q: Did it cross the group’s mind to set up a bank? Is that the final target which you are looking at? Is insurance anywhere on the radar?
A: Insurance is definitely there. We have a joint venture with Aegon. I will certainly hope that sometime early next year, we will be able to launch our life insurance venture. That is a very integral component of the financial services industry and our intention is to be a leader in that. Banking is a related and an integral part of the financial services world, but we need to take things one-step at a time.
Q: Beyond what was raised in the IPO for Religare, what sort of investment will this entity require between now and in the next couple of years, to bring through all these plans that you are mentioning?
A: There is a very well laid and thought out plan. We are acting on that step-by-step
Source: Moneycontrol.com
Tuesday, November 20, 2007
Edelweiss Capital IPO subscribed 110 times
The initial public offer (IPO) of Edelweiss Capital, a diversified financial services company, has received overwhelming response. The issue has subscribed 109.8 times till 5 pm, according to data available on NSE website.
It has received bids for 92 crore equity shares as against 8,386,147 equity shares of Rs 5 each on offer.
According to sources, qualified institutional investors and non institutional investors have given strong support to the issue, their reserved portion subscribed 125 times each followed by retail with 10 times subscription.
The price band has been fixed between Rs 725 and Rs 825 per equity share of face value Rs 5.
The proceeds of the issue will be used, inter alia, towards enhancement of margin maintenance with stock exchanges, establishment of additional offices and acquisition of office infrastructure, enhancement of existing technological capacity and loan prepayment.
Edelweiss Capital provides investment banking, institutional equities, private client broking, asset management, wealth management, insurance broking and wholesale financing services to corporate, institutional and high net worth individual clients.
The book running lead managers to the issue are Kotak Mahindra Capital Company Limited, Citigroup Global Markets India Private Limited and Lehman Brothers Securities Private Limited.
Courtesy: Moneycontrol.com
It has received bids for 92 crore equity shares as against 8,386,147 equity shares of Rs 5 each on offer.
According to sources, qualified institutional investors and non institutional investors have given strong support to the issue, their reserved portion subscribed 125 times each followed by retail with 10 times subscription.
The price band has been fixed between Rs 725 and Rs 825 per equity share of face value Rs 5.
The proceeds of the issue will be used, inter alia, towards enhancement of margin maintenance with stock exchanges, establishment of additional offices and acquisition of office infrastructure, enhancement of existing technological capacity and loan prepayment.
Edelweiss Capital provides investment banking, institutional equities, private client broking, asset management, wealth management, insurance broking and wholesale financing services to corporate, institutional and high net worth individual clients.
The book running lead managers to the issue are Kotak Mahindra Capital Company Limited, Citigroup Global Markets India Private Limited and Lehman Brothers Securities Private Limited.
Courtesy: Moneycontrol.com
Mudra Port IPO Allotment
Hello Guys,
Allotment of Mundra Port and Special Economic Zone Ltd is out. You can check the status of allotment on below sites:
http://www.intimespectrum.com
http://www.chittorgarh.com/stockmarket/Mundra-Port-ipo-allotment-status.asp
Thanks & All the best for allotment!!
Allotment of Mundra Port and Special Economic Zone Ltd is out. You can check the status of allotment on below sites:
http://www.intimespectrum.com
http://www.chittorgarh.com/stockmarket/Mundra-Port-ipo-allotment-status.asp
Thanks & All the best for allotment!!
All eyes on Religare listing tomorrow
There was a sudden reversal in the second half of the day and that is the surprising bit about today’s trade because in the morning, it looked as if the same kind of scrip was playing out. Asian markets were selling off because the US has sold off and most Asian markets were down about 3% odd.
We started with a small gap down of a couple of 100 points on the Sensex, recovered almost immediately and then midcaps started outperforming. It looked like it was one more of those days, where India would stand out against global under performance and streak out outperformance of its own. It played along for the first half of the day.
The difference is that the second half the market lost the plot a little bit. In fact there was a fairly severe sell off in the second half of the day, in the last one hour particularly, when the Sensex dropped 350 points and the Nifty was down about a 130. So we are back down to about 19,300 levels for the Sensex. All of it happening very quickly and the midcaps have corrected. That is the interesting bit about trade today. The midcaps, which had been going up corrected, the advance/decline ratio turned negative, the midcap index was down a couple of percentage points and even the Nifty Junior loss some ground.
Now, whether it is just a one day running blip to shake off some of the weaker hands or something bigger we will know in the next few days. But while it was happening, it was looking a little dangerous. May be it is just one of those running corrections which was overdue because the midcap end of the market was getting a bit overheated.
It might have a bit to do with Europe, all that talk of Fed not cutting rates, might have been some whiff of Chinese banks stopping lending or putting some unofficial curbs on lending. That might have filtered in. So, it could have been anything, which injected some uncertainty and there must have been some delivery based selling today. Infosys by the way is back down to Rs 1550 now, tremendous fall that stock has seen. Some of the largecap names like Unitech, ONGC also came off and power stocks too led by BHEL, Tata Power and ABB, also corrected a bit. So, there was selling in the largecap universe.
In the midcaps, it was a little bit mixed. Some of the oil stocks like Essar Oil continue to correct, Bongaigaon and Chennai Petro too have recoiled somewhat. A few of the popular trading stocks likeIndusInd, Syndicate Bank, Alok Industries, Triveni Engineering have corrected today. But it is not one-way at all. We have had some spectacular movers today in the form of Deccan Aviation, which has shot up to Rs 200,which is a 23% move. We had a big move in Jindal Stainless, that was another stock, which stood out, and Prism Cement was another stock, which had a great rally today.
Among other sharp movers SRF, Dish TV and WWIL particularly because of the news reports of that proposed move on FDI and cable TV.
UCO Bank did well and fertilizers led by Nagarjuna and Chambal Fertiliser continues to do well. Interesting mix of midcaps but today after many days, we are seeing some signs of a reversal. So, tomorrow is a crucial day of trade, we will figure out if this was just a one off running correction, just to led some steam off or is there something deeper to it. Tomorrow ofcourse, Religare listing promises to be a cracker of a listing, way-way above its issue price.
Source: Moneycontrol.com
We started with a small gap down of a couple of 100 points on the Sensex, recovered almost immediately and then midcaps started outperforming. It looked like it was one more of those days, where India would stand out against global under performance and streak out outperformance of its own. It played along for the first half of the day.
The difference is that the second half the market lost the plot a little bit. In fact there was a fairly severe sell off in the second half of the day, in the last one hour particularly, when the Sensex dropped 350 points and the Nifty was down about a 130. So we are back down to about 19,300 levels for the Sensex. All of it happening very quickly and the midcaps have corrected. That is the interesting bit about trade today. The midcaps, which had been going up corrected, the advance/decline ratio turned negative, the midcap index was down a couple of percentage points and even the Nifty Junior loss some ground.
Now, whether it is just a one day running blip to shake off some of the weaker hands or something bigger we will know in the next few days. But while it was happening, it was looking a little dangerous. May be it is just one of those running corrections which was overdue because the midcap end of the market was getting a bit overheated.
It might have a bit to do with Europe, all that talk of Fed not cutting rates, might have been some whiff of Chinese banks stopping lending or putting some unofficial curbs on lending. That might have filtered in. So, it could have been anything, which injected some uncertainty and there must have been some delivery based selling today. Infosys by the way is back down to Rs 1550 now, tremendous fall that stock has seen. Some of the largecap names like Unitech, ONGC also came off and power stocks too led by BHEL, Tata Power and ABB, also corrected a bit. So, there was selling in the largecap universe.
In the midcaps, it was a little bit mixed. Some of the oil stocks like Essar Oil continue to correct, Bongaigaon and Chennai Petro too have recoiled somewhat. A few of the popular trading stocks likeIndusInd, Syndicate Bank, Alok Industries, Triveni Engineering have corrected today. But it is not one-way at all. We have had some spectacular movers today in the form of Deccan Aviation, which has shot up to Rs 200,which is a 23% move. We had a big move in Jindal Stainless, that was another stock, which stood out, and Prism Cement was another stock, which had a great rally today.
Among other sharp movers SRF, Dish TV and WWIL particularly because of the news reports of that proposed move on FDI and cable TV.
UCO Bank did well and fertilizers led by Nagarjuna and Chambal Fertiliser continues to do well. Interesting mix of midcaps but today after many days, we are seeing some signs of a reversal. So, tomorrow is a crucial day of trade, we will figure out if this was just a one off running correction, just to led some steam off or is there something deeper to it. Tomorrow ofcourse, Religare listing promises to be a cracker of a listing, way-way above its issue price.
Source: Moneycontrol.com
Religare Enterprises to see bumper listing
All brokerage stocks are buzzing today ahead of Religare Enterprises' listing and current IPOs like Edelweiss Capital. All brokerage stocks are up around 2-5%.
Religare Enterprises, a financial services company in India offering a wide range of financial products and services, will list on the bourses on November 21, 2007.
Analysts told Moneycontrol.com that the stock is likely to list in the band of Rs 525-600 and advised partial profit booking.
R S Iyer of K R Choksey Securities said, "Religare is expected to list at around Rs 550-600 levels. One can book profits if it crosses Rs 650 on listing day.
Investment Advisor, S P Tulsian said, "Religare Enterprises is likely to list at Rs 540 against its issue price of Rs 185 per share. Investors are advised to hold the stock with 3 months view."
The stock is likely to list with premium of Rs 350 plus. Investors, who got shares in allotment, can sell 50% shares around Rs 525 and hold balance shares with short to medium term view, according to Manish Bhatt of Prabhudas Lilladher.
"Keeping in mind the geographical diversification, wide range of products and services offered by the company and the long term growth story in the financial services sector, investors with a long term perspective could hold on for better returns in the long run. However in case of aggressive listing, partial profits can be booked", said Arpit Agrawal – Head of Research, Arihant Capital Markets.
The company had fixed the issue price at Rs 185 per equity share of Rs 10 each (upper end of the price band) for its initial public offering (IPO) of 7,576,102 equity shares for cash, decided through a 100% book building process. The issue was subscribed approximately around 160.56 times.
The net proceeds of the issue would be utilized towards expansion of the domestic operations as well as the network of branches of two of its subsidiaries, Religare Securities Limited and Religare Insurance Broking Limited; funding the retail finance business as well as funding the leading business, through investment in its subsidiaries, Religare Finvest Limited and Religare Finance Limited.
The book running lead managers to the issue are: Enam Securities Private Limited and Citigroup Global Markets India Private Limited.
Source: Moneycontrol.com
Religare Enterprises, a financial services company in India offering a wide range of financial products and services, will list on the bourses on November 21, 2007.
Analysts told Moneycontrol.com that the stock is likely to list in the band of Rs 525-600 and advised partial profit booking.
R S Iyer of K R Choksey Securities said, "Religare is expected to list at around Rs 550-600 levels. One can book profits if it crosses Rs 650 on listing day.
Investment Advisor, S P Tulsian said, "Religare Enterprises is likely to list at Rs 540 against its issue price of Rs 185 per share. Investors are advised to hold the stock with 3 months view."
The stock is likely to list with premium of Rs 350 plus. Investors, who got shares in allotment, can sell 50% shares around Rs 525 and hold balance shares with short to medium term view, according to Manish Bhatt of Prabhudas Lilladher.
"Keeping in mind the geographical diversification, wide range of products and services offered by the company and the long term growth story in the financial services sector, investors with a long term perspective could hold on for better returns in the long run. However in case of aggressive listing, partial profits can be booked", said Arpit Agrawal – Head of Research, Arihant Capital Markets.
The company had fixed the issue price at Rs 185 per equity share of Rs 10 each (upper end of the price band) for its initial public offering (IPO) of 7,576,102 equity shares for cash, decided through a 100% book building process. The issue was subscribed approximately around 160.56 times.
The net proceeds of the issue would be utilized towards expansion of the domestic operations as well as the network of branches of two of its subsidiaries, Religare Securities Limited and Religare Insurance Broking Limited; funding the retail finance business as well as funding the leading business, through investment in its subsidiaries, Religare Finvest Limited and Religare Finance Limited.
The book running lead managers to the issue are: Enam Securities Private Limited and Citigroup Global Markets India Private Limited.
Source: Moneycontrol.com
Monday, November 19, 2007
Mixed reaction to Kaushalya Infrastructure IPO
Kaushalya Infrastructure Development Corporation is entering capital markets with an IPO of 85 lakh equity shares of Rs 10 each for cash at a premium to be decided by 100 per cent book building process.
The price band is fixed between Rs 50 and Rs 60. The issue will open on November 20 and close on November 23. The shares are proposed to be listed on the BSE and NSE.
The company plans to use the proceeds from the issue to fund land acquisition, land development rights and real estate development, investment in BOT/BOOT projects for joint ventures, and purchase of capital and infrastructure equipment for the execution of projects.
Up to 4.75 lakh equity shares will be reserved for employees and net issue to the public would be 80,25,000 equity shares.
This net issue would constitute 40.93 per cent of the fully diluted post-issue paid-up capital of the company.
SREI Capital Markets Ltd will be the lead managers of the issue and Intime Spectrum Registry Ltd the registrar.
Source: Moneycontrol.com
The price band is fixed between Rs 50 and Rs 60. The issue will open on November 20 and close on November 23. The shares are proposed to be listed on the BSE and NSE.
The company plans to use the proceeds from the issue to fund land acquisition, land development rights and real estate development, investment in BOT/BOOT projects for joint ventures, and purchase of capital and infrastructure equipment for the execution of projects.
Up to 4.75 lakh equity shares will be reserved for employees and net issue to the public would be 80,25,000 equity shares.
This net issue would constitute 40.93 per cent of the fully diluted post-issue paid-up capital of the company.
SREI Capital Markets Ltd will be the lead managers of the issue and Intime Spectrum Registry Ltd the registrar.
Source: Moneycontrol.com
Subscribe to Kolte-Patil with medium term view
Keynote Capitals has come out with report on Kolte-Patil Developers IPO. They have recommended to subscribe to the issue with medium term view.
Kolte-Patil Developers, a real estate developer in India, has opened for subscription with an initial public offering (IPO) of 19,000,836 equity shares of Rs 10 each for cash at a price to be decided through a 100% book-building process.
The issue will close on November 22, 2007. The price band has been fixed between Rs 125 and Rs 145 per equity share.
Keynote Capitals report on Kolte-Patil Developers IPO
Recommendation - Subscribe with a medium term view
* Kolte-Patil Developers (KPDL) is a real estate developer, having presence mainly in the cities of Pune and Bangalore. It has a diversified project portfolio across residential properties, townships, commercial properties, IT parks etc. Has an experienced management team.
* Land reserves of around 54.5mn sq ft. Of this, approx. 39mn sq ft represents expected saleable area. However, land owned and land over which it has sole development rights aggregates to 57.7% of land bank, which is on the lower side vis-à-vis developers like Omaxe (76.2%) and IVR Prime Urban (73%) (source: respective RHPs).
* Its JVs provide it with the ability to capitalise on bigger opportunities, raise funding via the equity and debt routes and undertake large-scale development projects.
* On account of the increase in sales of IT premises in FY07, topline and bottomline grew at a CAGR of 174.1% and 486.8% during FY05-07 respectively on standalone basis.
* Diversification of its project portfolio and expansion into emerging local markets like Hyderabad, Chennai, Nasik, Goa, Nagpur, Aurangabad and Mysore will help derisk its business model.
* Its accounting practice of recognising revenues and expenses only in the period in which the project is completed leads to volatility of revenues.
* On the basis of its project implementation schedule, we estimate sales revenues to grow at 51.4% CAGR during FY07-09. We expect a modest 10.7% bottomline growth in FY08, followed by a 70.5% growth in FY09, as a number of projects are likely to get completed in that year. We expect a slight impact on EBITDA margin and accordingly expect net profit to grow at a 37.4% CAGR during FY07-09.
* Tax provision of 22.8% of PBT for FY07 is comparable with that of peers Parsvnath (24.7%), IVR Prime (34%) and DS Kulkarni (14%).
* Concentration of approx. 92% of land reserves in and around Pune is both a positive (due to the IT/BPO backed real estate boom in Pune) and a concern (over-exposure to a single city).
* The IPO valuation, at 11.8x FY08E and 6.9x FY09E earnings is in line with that of peers (Parsvnath Developers at 6.1x FY09E, D.S. Kulkarni Developers at 6.2x FY09E and Akruti Nirman at 11.1x FY09E). Our NPV valuation is in the broad range of Rs187 - 258 per share, translating into a price/NPV multiple of 0.56 - 0.77x.We recommend subscribing to the IPO with a medium term view.
Concerns
* Approx. 92% of the projects portfolio is concentrated in and around Pune.
* Revenue for long-term projects is recognized in the year in which the sale is completed. Therefore, there may be long lead time in the development of a project leading to earnings volatility.
Source: Moneycontrol.com
Kolte-Patil Developers, a real estate developer in India, has opened for subscription with an initial public offering (IPO) of 19,000,836 equity shares of Rs 10 each for cash at a price to be decided through a 100% book-building process.
The issue will close on November 22, 2007. The price band has been fixed between Rs 125 and Rs 145 per equity share.
Keynote Capitals report on Kolte-Patil Developers IPO
Recommendation - Subscribe with a medium term view
* Kolte-Patil Developers (KPDL) is a real estate developer, having presence mainly in the cities of Pune and Bangalore. It has a diversified project portfolio across residential properties, townships, commercial properties, IT parks etc. Has an experienced management team.
* Land reserves of around 54.5mn sq ft. Of this, approx. 39mn sq ft represents expected saleable area. However, land owned and land over which it has sole development rights aggregates to 57.7% of land bank, which is on the lower side vis-à-vis developers like Omaxe (76.2%) and IVR Prime Urban (73%) (source: respective RHPs).
* Its JVs provide it with the ability to capitalise on bigger opportunities, raise funding via the equity and debt routes and undertake large-scale development projects.
* On account of the increase in sales of IT premises in FY07, topline and bottomline grew at a CAGR of 174.1% and 486.8% during FY05-07 respectively on standalone basis.
* Diversification of its project portfolio and expansion into emerging local markets like Hyderabad, Chennai, Nasik, Goa, Nagpur, Aurangabad and Mysore will help derisk its business model.
* Its accounting practice of recognising revenues and expenses only in the period in which the project is completed leads to volatility of revenues.
* On the basis of its project implementation schedule, we estimate sales revenues to grow at 51.4% CAGR during FY07-09. We expect a modest 10.7% bottomline growth in FY08, followed by a 70.5% growth in FY09, as a number of projects are likely to get completed in that year. We expect a slight impact on EBITDA margin and accordingly expect net profit to grow at a 37.4% CAGR during FY07-09.
* Tax provision of 22.8% of PBT for FY07 is comparable with that of peers Parsvnath (24.7%), IVR Prime (34%) and DS Kulkarni (14%).
* Concentration of approx. 92% of land reserves in and around Pune is both a positive (due to the IT/BPO backed real estate boom in Pune) and a concern (over-exposure to a single city).
* The IPO valuation, at 11.8x FY08E and 6.9x FY09E earnings is in line with that of peers (Parsvnath Developers at 6.1x FY09E, D.S. Kulkarni Developers at 6.2x FY09E and Akruti Nirman at 11.1x FY09E). Our NPV valuation is in the broad range of Rs187 - 258 per share, translating into a price/NPV multiple of 0.56 - 0.77x.We recommend subscribing to the IPO with a medium term view.
Concerns
* Approx. 92% of the projects portfolio is concentrated in and around Pune.
* Revenue for long-term projects is recognized in the year in which the sale is completed. Therefore, there may be long lead time in the development of a project leading to earnings volatility.
Source: Moneycontrol.com
Saturday, November 17, 2007
Subscribe to Edelweiss with medium term view
Keynote Capitals has come out with report on Edelweiss Capital IPO. The firm has advised to subscribe the issue with medium term view.
Edelweiss Capital, a diversified financial services company, has opened for subscription with its initial public offering (IPO) of 8,386,147 equity shares of Rs 5 each for cash, at a price to be decided through a 100% book building process.
The issue will close close on November 20, 2007. The price band is between Rs 725 and Rs 825 per equity share of face value Rs 5.
Keynote Capitals report on Edelweiss Capital IPO
Recommendation - Subscribe with a medium term view
* Edelweiss Capital (ECL) is a diversified financial services company in India offering services to corporate, institutional and high-net-worth clients. It operates from 43 offices in 19 Indian cities. Strong, professional management.
* It operates through various subsidiaries to offer a wide spectrum of services. Impressive track record since inception in 1995. Topline and bottomline grew at a CAGR of 130% and 142% respectively during FY04-07.
* Bottomline growth mainly on account of expanding EBITDA margin, up from 46.3% in FY04 to 52.6% in FY07. Higher margin attributable to revenues from proprietary trading, institutional clients and investment banking. Its investment banking division has been scaling up operations, successfully lead managed IPOs of MIC Electronics, Meghmani Organics, C & C Construction etc.
* The IPO is aimed primarily at meeting margin money requirements indicating strong growth in the clientele base.
* ECL’s cash balance as of August 2007 stood at Rs 994 crore. In spite of the huge cash on its books, it is raising money primarily to have adequate liquidity and also for prepayment of loan of Rs 105 crore.
* When compared with peers MOFSL and Religare (which went public recently), across a few key parameters, ECL comes across as a mixed bag.
* EBITDA margin superior vis-à-vis that of MOFSL and Religare (32% and 37% respectively).
* MOFSL and Religare have presence in both institutional and retail segments. ECL, however, does not have much presence in the retail segment.
* ROE declined from 42.8% in FY05 to 18.8% in FY07 due to the expansion in net worth, attributable to the issue of preference share capital. However, in spite of this, ROE is on par with that of MOFSL and Religare.
* Broking income constituted 58.4% of ECL’s FY07 revenues; vis-à-vis 87% and 50%% for MOFSL and
Religare respectively. For ECL, income from arbitrage and trading constituted as much as 31% of FY07 revenues. We find the bias towards arbitrage and trading revenues to be a matter of concern.
* Lower leverage and higher interest coverage than that of Religare (however, ECL’s interest cost has increased substantially during the period of 5 months to August 31, 2007, due to sharp increase in debt.
* Reduction in promoter/group stake to just 35%, post-IPO is also a concern.
* Pre-IPO placements to Galleon Special Opportunities Master Fund, Sequoia Capital India and promoters in August, 2007 @ Rs514/517 per share, the last reflecting a discount of 60% to the IPO cap price.
* In line with expected growth in operations, we expect topline and bottomline growth CAGR of 70.3% each during FY07-09. As per our estimates, ECL’s IPO valuation (36.8xFY08E and 21.3x FY09E) is somewhere in between that of MOFSL (39.7xFY08E and 28.4xFY09E) and Religare (22.6xFY08E and 14.4xFY09E). However, in view of strong promoter background and brand equity, we recommend subscribing with a medium term view.
Investment Concerns
* Downturns or disruptions in securities markets could reduce transaction volumes, causing a decline in business. Revenues from operations arise largely during bullish phase in equity market which is not a consistent phenomenon.
* The subsidiary ESL was barred by securities regulators from dealing in securities of certain Indian companies in the past. ECL derives significant business from ESL, any effect in its operations shall affect the consolidated numbers.
* The subsidiary Edelweiss Capital USA LLC is into losses to the tune of Rs 0.09 crore as of August 31, 2007.
* Asset management, investment advisory, financing and wealth management are new businesses in which ECL has recently forayed. It does not have lot of experience in this field.
* There are conflicts of interest within promoter and promoter group. They have equity interests in other entities namely Ivy Financial Services Pvt Ltd and E Cap Partners.
Source: Moneycontrol.com
Edelweiss Capital, a diversified financial services company, has opened for subscription with its initial public offering (IPO) of 8,386,147 equity shares of Rs 5 each for cash, at a price to be decided through a 100% book building process.
The issue will close close on November 20, 2007. The price band is between Rs 725 and Rs 825 per equity share of face value Rs 5.
Keynote Capitals report on Edelweiss Capital IPO
Recommendation - Subscribe with a medium term view
* Edelweiss Capital (ECL) is a diversified financial services company in India offering services to corporate, institutional and high-net-worth clients. It operates from 43 offices in 19 Indian cities. Strong, professional management.
* It operates through various subsidiaries to offer a wide spectrum of services. Impressive track record since inception in 1995. Topline and bottomline grew at a CAGR of 130% and 142% respectively during FY04-07.
* Bottomline growth mainly on account of expanding EBITDA margin, up from 46.3% in FY04 to 52.6% in FY07. Higher margin attributable to revenues from proprietary trading, institutional clients and investment banking. Its investment banking division has been scaling up operations, successfully lead managed IPOs of MIC Electronics, Meghmani Organics, C & C Construction etc.
* The IPO is aimed primarily at meeting margin money requirements indicating strong growth in the clientele base.
* ECL’s cash balance as of August 2007 stood at Rs 994 crore. In spite of the huge cash on its books, it is raising money primarily to have adequate liquidity and also for prepayment of loan of Rs 105 crore.
* When compared with peers MOFSL and Religare (which went public recently), across a few key parameters, ECL comes across as a mixed bag.
* EBITDA margin superior vis-à-vis that of MOFSL and Religare (32% and 37% respectively).
* MOFSL and Religare have presence in both institutional and retail segments. ECL, however, does not have much presence in the retail segment.
* ROE declined from 42.8% in FY05 to 18.8% in FY07 due to the expansion in net worth, attributable to the issue of preference share capital. However, in spite of this, ROE is on par with that of MOFSL and Religare.
* Broking income constituted 58.4% of ECL’s FY07 revenues; vis-à-vis 87% and 50%% for MOFSL and
Religare respectively. For ECL, income from arbitrage and trading constituted as much as 31% of FY07 revenues. We find the bias towards arbitrage and trading revenues to be a matter of concern.
* Lower leverage and higher interest coverage than that of Religare (however, ECL’s interest cost has increased substantially during the period of 5 months to August 31, 2007, due to sharp increase in debt.
* Reduction in promoter/group stake to just 35%, post-IPO is also a concern.
* Pre-IPO placements to Galleon Special Opportunities Master Fund, Sequoia Capital India and promoters in August, 2007 @ Rs514/517 per share, the last reflecting a discount of 60% to the IPO cap price.
* In line with expected growth in operations, we expect topline and bottomline growth CAGR of 70.3% each during FY07-09. As per our estimates, ECL’s IPO valuation (36.8xFY08E and 21.3x FY09E) is somewhere in between that of MOFSL (39.7xFY08E and 28.4xFY09E) and Religare (22.6xFY08E and 14.4xFY09E). However, in view of strong promoter background and brand equity, we recommend subscribing with a medium term view.
Investment Concerns
* Downturns or disruptions in securities markets could reduce transaction volumes, causing a decline in business. Revenues from operations arise largely during bullish phase in equity market which is not a consistent phenomenon.
* The subsidiary ESL was barred by securities regulators from dealing in securities of certain Indian companies in the past. ECL derives significant business from ESL, any effect in its operations shall affect the consolidated numbers.
* The subsidiary Edelweiss Capital USA LLC is into losses to the tune of Rs 0.09 crore as of August 31, 2007.
* Asset management, investment advisory, financing and wealth management are new businesses in which ECL has recently forayed. It does not have lot of experience in this field.
* There are conflicts of interest within promoter and promoter group. They have equity interests in other entities namely Ivy Financial Services Pvt Ltd and E Cap Partners.
Source: Moneycontrol.com
Friday, November 16, 2007
Kolte-Patil IPO looks reasonably priced
Kolte-Patil Developers, a real estate developer in India, is entering the capital markets with an initial public offering (IPO) of 19,000,836 equity shares of Rs 10 each for cash at a price to be decided through a 100% book-building process.
The issue will open on November 19, 2007, and will close on November 22, 2007. The price band has been fixed between Rs 125 and Rs 145 per equity share.
The objects of the issue are to finance acquisition of development rights; finance the construction and development costs for some of the proposed projects; fund expenditure for general corporate purposes and achieve the benefits of listing on the Stock Exchange.
The issue comprises a net issue of 18,812,709 equity shares to the public and a reservation of 188,127 equity shares for eligible employees. The issue will constitute 25.25% while the net issue will constitute 25% respectively of the post-Issue paid up capital of the company. The equity shares are proposed to be listed on the NSE and BSE.
The company posted a total income (consolidated) of Rs 2, 524.43 million in fiscal 2007 and an adjusted profit after tax of Rs 835.61 million. For the 3 months ended June 30, 2007 , the Company posted a total income (consolidated) of Rs 889.65 million and an adjusted profit after tax of Rs 338.76 million..
The book running lead managers to the issue are DSP Merrill Lynch Limited and Edelweiss Capital Limited.
Courtesy: Moneycontrol.com
The issue will open on November 19, 2007, and will close on November 22, 2007. The price band has been fixed between Rs 125 and Rs 145 per equity share.
The objects of the issue are to finance acquisition of development rights; finance the construction and development costs for some of the proposed projects; fund expenditure for general corporate purposes and achieve the benefits of listing on the Stock Exchange.
The issue comprises a net issue of 18,812,709 equity shares to the public and a reservation of 188,127 equity shares for eligible employees. The issue will constitute 25.25% while the net issue will constitute 25% respectively of the post-Issue paid up capital of the company. The equity shares are proposed to be listed on the NSE and BSE.
The company posted a total income (consolidated) of Rs 2, 524.43 million in fiscal 2007 and an adjusted profit after tax of Rs 835.61 million. For the 3 months ended June 30, 2007 , the Company posted a total income (consolidated) of Rs 889.65 million and an adjusted profit after tax of Rs 338.76 million..
The book running lead managers to the issue are DSP Merrill Lynch Limited and Edelweiss Capital Limited.
Courtesy: Moneycontrol.com
Wednesday, November 14, 2007
Renaissance Jewellery: IPO proceeds will fund expansion
Renaissance Jewellery will foray into the capital markets with a public issue of 53.24 lakh equity shares. The issue, which has a price band of Rs 125-150, opens for subscription on November 19.
Sumit Shah, Managing Director, Renaissance Jewellery, said the company has hedged itself against the appreciating rupee.
Excerpts from CNBC-TV18's exclusive interview with Sumit Shah:
Q: Where are you going to deploying this Rs 80 crore? 90% of your revenues come in from the US market, do you expect that to be hit by the rupee appreciation?
A: 95% of our revenues come from our US business. Our company is uniquely positioned, as we have a natural hedge against the appreciating rupee. 83% of our sales are raw materials, which are dollar denominated. Even our working capital loans are in terms of dollars. So, essentially our company is hedged against the appreciating rupee.
In terms of deployment, we plan to use about Rs 35 crore to setup a distribution company in the US to distribute to small and mid-size retailers. Currently, our business comes from large retailers like Wal-Mart, who awarded us the Global Supplier of the Year in the past. We do not distribute to small and midsize retailers but we plan to increase our presence there.
About Rs 15 crore, will be spent towards increasing capacity at our Bhavnagar and Mumbai manufacturing facilities. The balance will be utilized to increase our long-term working capital.
Q: What are the average margins that you operate at? For the first quarter of this year, you have done about Rs 118 crore in terms of revenues. Would it be fair to assume that you could go in excess of Rs 500 crore for revenues, and if so, what margins and profitability?
A: In the first quarter of the year we have done Rs 118 crore. The first quarter tends to be the slowest quarter for the jewellery business worldwide because most of the main selling seasons are Christmas, Valentine’s Day and Mother’s Day. We expect to continue to grow at good pace. The first quarter results were quite encouraging.
Source: Moneycontrol.com
Sumit Shah, Managing Director, Renaissance Jewellery, said the company has hedged itself against the appreciating rupee.
Excerpts from CNBC-TV18's exclusive interview with Sumit Shah:
Q: Where are you going to deploying this Rs 80 crore? 90% of your revenues come in from the US market, do you expect that to be hit by the rupee appreciation?
A: 95% of our revenues come from our US business. Our company is uniquely positioned, as we have a natural hedge against the appreciating rupee. 83% of our sales are raw materials, which are dollar denominated. Even our working capital loans are in terms of dollars. So, essentially our company is hedged against the appreciating rupee.
In terms of deployment, we plan to use about Rs 35 crore to setup a distribution company in the US to distribute to small and mid-size retailers. Currently, our business comes from large retailers like Wal-Mart, who awarded us the Global Supplier of the Year in the past. We do not distribute to small and midsize retailers but we plan to increase our presence there.
About Rs 15 crore, will be spent towards increasing capacity at our Bhavnagar and Mumbai manufacturing facilities. The balance will be utilized to increase our long-term working capital.
Q: What are the average margins that you operate at? For the first quarter of this year, you have done about Rs 118 crore in terms of revenues. Would it be fair to assume that you could go in excess of Rs 500 crore for revenues, and if so, what margins and profitability?
A: In the first quarter of the year we have done Rs 118 crore. The first quarter tends to be the slowest quarter for the jewellery business worldwide because most of the main selling seasons are Christmas, Valentine’s Day and Mother’s Day. We expect to continue to grow at good pace. The first quarter results were quite encouraging.
Source: Moneycontrol.com
BSE IPO to hit mkt before March 2008
According to sources, the Bombay Stock Exchange (BSE) is thinking of launching Sensex futures on Deutsche Bourse & SGX. The BSE IPO will hit the market before March ’08, they add. The BSE will expand its equity by 10% for IPO, sources say. The BSE will raise over Rs 500 crore for the IPO. Sources add that the BSE will enter a strategic tie-up with ASE (Ahmedabad Stock Exchange). ASE members may be able to access BOLT post tie-up, they say. The BSE tie-up with KSE (Kolkata Stock Exchange)& ASE will revive derivative segment, sources estimate.
Source: Moneycontrol.com
Tuesday, November 13, 2007
Apply for Edelweiss Capital IPO
SKP Securities has come out with a report on Edelweiss Capital IPO. Based on a strong outlook for the Indian economy, and growing investment banking business, the firm has recommended subscribe to the issue.
Edelweiss Capital, a diversified financial services company, is entering the capital market with its initial public offering (IPO) of 8,386,147 equity shares of Rs 5 each for cash, at a price to be decided through a 100% book building process.
The issue will open on November 15, 2007, and will close on November 20, 2007. The price band has been fixed between Rs 725 and Rs 825 per equity share of face value Rs 5.
SKP Securities report on Edelweiss Capital IPO
Investment Highlights:
Edelweiss Capital (ECL) is a diversified financial services company in India, providing investment banking, institutional equities, private client broking, asset management and investment advisory services, wealth management, insurance broking and wholesale financing services to corporate, institutional and high net worth individual clients.
Key strengths:
An integrated financial services platform: ECL’s integrated service platform allows it to leverage relationships across lines of businesses by providing multi-channel delivery systems to its client base, thereby increasing its ability to cross-sell various services.
Research driven approach: ECL have a strong research platform consisting of fundamental and alternative research, catering to institutional and high net worth individual investors. Fundamental research covers approximately 190 companies, which represent approximately 69% of the market capitalization of all companies listed on the BSE. ECL's strength lies in identifying emerging investment themes that will drive economic activity, investments, growth and profitability of companies and showcasing them to its clients.
The objects of the issue are:
Enhancement of margin maintenance with Exchanges,
Establishment of additional offices and acquisition of office infrastructure,
Enhancement of existing technological capacity,
Prepayment of loans
Financial Performance (Consolidated) Uses and Source of Funds
Concerns:
* ECL’s business is highly dependent on the capital market. About 58% of the company’s income comes from institutional broking and investment banking businesses, followed by 31% from treasury operations. Difficult market conditions can adversely affect the business of ECL.
* ECL is subject to extensive securities regulation and any failure to comply with these regulations may lead to imposition of penalties or sanctions.
Recommendation:
ECL is an established brand and has a strong network of investor relationships. Based on a strong outlook for the Indian economy, and growing investment banking business, we recommend Subscribe to the issue.
Courtesy: moneycontrol.com
Edelweiss Capital, a diversified financial services company, is entering the capital market with its initial public offering (IPO) of 8,386,147 equity shares of Rs 5 each for cash, at a price to be decided through a 100% book building process.
The issue will open on November 15, 2007, and will close on November 20, 2007. The price band has been fixed between Rs 725 and Rs 825 per equity share of face value Rs 5.
SKP Securities report on Edelweiss Capital IPO
Investment Highlights:
Edelweiss Capital (ECL) is a diversified financial services company in India, providing investment banking, institutional equities, private client broking, asset management and investment advisory services, wealth management, insurance broking and wholesale financing services to corporate, institutional and high net worth individual clients.
Key strengths:
An integrated financial services platform: ECL’s integrated service platform allows it to leverage relationships across lines of businesses by providing multi-channel delivery systems to its client base, thereby increasing its ability to cross-sell various services.
Research driven approach: ECL have a strong research platform consisting of fundamental and alternative research, catering to institutional and high net worth individual investors. Fundamental research covers approximately 190 companies, which represent approximately 69% of the market capitalization of all companies listed on the BSE. ECL's strength lies in identifying emerging investment themes that will drive economic activity, investments, growth and profitability of companies and showcasing them to its clients.
The objects of the issue are:
Enhancement of margin maintenance with Exchanges,
Establishment of additional offices and acquisition of office infrastructure,
Enhancement of existing technological capacity,
Prepayment of loans
Financial Performance (Consolidated) Uses and Source of Funds
Concerns:
* ECL’s business is highly dependent on the capital market. About 58% of the company’s income comes from institutional broking and investment banking businesses, followed by 31% from treasury operations. Difficult market conditions can adversely affect the business of ECL.
* ECL is subject to extensive securities regulation and any failure to comply with these regulations may lead to imposition of penalties or sanctions.
Recommendation:
ECL is an established brand and has a strong network of investor relationships. Based on a strong outlook for the Indian economy, and growing investment banking business, we recommend Subscribe to the issue.
Courtesy: moneycontrol.com
Monday, November 12, 2007
UTI MF plans IPO by mid-Feb
UTI Mutual Fund is planning to float its initial public offer by mid-February, Chairman and Managing Director U.K. Sinha said today.
"We have time to complete the entire process by Mar 31, but are hoping to come out with the IPO by first-half of February," he told Newswire18. The fund house has finalised seven investment managers for the proposed IPO, he said. JM Financial, Enam Securities and Citibank are the global co-ordinators, while UBS, Goldman Sachs, ICICI Securities and SBI Securities will act as the lead book-running managers.
Tuesday, NewsWire18 had reported that the fund house would decide on the timing of its proposed initial public offer and finalise the merchant bankers on Wednesday. Sinha also said the public offer's valuation is still being worked upon. Last month, the fund house had said it would be filing draft offer documents for the IPO by December and would also sell 20% stake to a private player well before the issue.
UTI Mutual Fund will be the country's first mutual fund to be listed on a stock exchange. In October, assets under management of the third largest fund house stood at Rs 517.53 billion, up 15% from a month ago. CNBC-TV18 has learnt that India's third largest mutual fund – UTI, is looking to raise nearly USD 1.5 billion dollars through its forthcoming IPO. There is reason for SBI, Bank of Baroda, LIC and PNB to celebrate.
Investors will soon be able to trade UTI, without investing in its funds. UTI mutual funds is all set to be India's first listed asset management company. It has roped in seven investment bankers - Citi, JM Financial, Enam, UBS, Goldman Sachs, SBI Capital and ICICI Securities. It is a two-part process. First, UTI will raise funds through a pre-IPO placement, which will expand its equity by 20%. But no single investor will hold more than 5%. The pre-IPO placement will help UTI raise about Rs 2,000-3,000 crore, which will be used for expansion plans.
"We are now going to raise a third fund. For that, we need seed capital and for that, we need money. We are also going to float an infrastructure PE fund of USD 500 million, for which we are looking for partners. But we need money for that. We are also planning branch expansion,” said U K Sinha, CMD, UTI MF. By March ’08, UTI plans to double its branches to 150 and raise this to 300 branches over the next year.
That private placement will bring down the shareholding of its promoter PSUs - SBI, LIC, BOB and PNB, from the current 25% to 20% each. After which, each of these PSUs will dilute another 7.25% each, or 29% in all, for a total Rs 5,000- 6,000 crore. That means a tenfold return for these players. They will pocket Rs 1,250 crore for stake that was recently valued at Rs 156 crore. And all this money is expected to come to these investors over the next three months.
Source: moneycontrol.com
"We have time to complete the entire process by Mar 31, but are hoping to come out with the IPO by first-half of February," he told Newswire18. The fund house has finalised seven investment managers for the proposed IPO, he said. JM Financial, Enam Securities and Citibank are the global co-ordinators, while UBS, Goldman Sachs, ICICI Securities and SBI Securities will act as the lead book-running managers.
Tuesday, NewsWire18 had reported that the fund house would decide on the timing of its proposed initial public offer and finalise the merchant bankers on Wednesday. Sinha also said the public offer's valuation is still being worked upon. Last month, the fund house had said it would be filing draft offer documents for the IPO by December and would also sell 20% stake to a private player well before the issue.
UTI Mutual Fund will be the country's first mutual fund to be listed on a stock exchange. In October, assets under management of the third largest fund house stood at Rs 517.53 billion, up 15% from a month ago. CNBC-TV18 has learnt that India's third largest mutual fund – UTI, is looking to raise nearly USD 1.5 billion dollars through its forthcoming IPO. There is reason for SBI, Bank of Baroda, LIC and PNB to celebrate.
Investors will soon be able to trade UTI, without investing in its funds. UTI mutual funds is all set to be India's first listed asset management company. It has roped in seven investment bankers - Citi, JM Financial, Enam, UBS, Goldman Sachs, SBI Capital and ICICI Securities. It is a two-part process. First, UTI will raise funds through a pre-IPO placement, which will expand its equity by 20%. But no single investor will hold more than 5%. The pre-IPO placement will help UTI raise about Rs 2,000-3,000 crore, which will be used for expansion plans.
"We are now going to raise a third fund. For that, we need seed capital and for that, we need money. We are also going to float an infrastructure PE fund of USD 500 million, for which we are looking for partners. But we need money for that. We are also planning branch expansion,” said U K Sinha, CMD, UTI MF. By March ’08, UTI plans to double its branches to 150 and raise this to 300 branches over the next year.
That private placement will bring down the shareholding of its promoter PSUs - SBI, LIC, BOB and PNB, from the current 25% to 20% each. After which, each of these PSUs will dilute another 7.25% each, or 29% in all, for a total Rs 5,000- 6,000 crore. That means a tenfold return for these players. They will pocket Rs 1,250 crore for stake that was recently valued at Rs 156 crore. And all this money is expected to come to these investors over the next three months.
Source: moneycontrol.com
Sunday, November 11, 2007
Kolte-Patil Dvlprs has 28 ongoing proj in Pune, Bangalore
Rajesh Patil, CMD of Kolte-Patil Developers has informed that his company has 28 ongoing projects in Pune and Bangalore; 23 are residential and 5 are commercial, IT Parks. They plan to raise Rs 275 crore from the IPO, he added.
Excerpts from CNBC-TV18’s exclusive interview with Rajesh Patil:
Q: What is the total amount of money that you require currently?
A: The amount we will be raising from IPO is Rs 275 crore.
Q: Are you doing any kind of pre-IPO placement before the IPO opens or are you also looking at raising debt for your expansion?
A: Definitely, we will be raising debts. Currently the company has debts of Rs 70 crore and future debt requirements will be project specific.
Q: Give us an idea of the joint venture that you have with ICICI Venture Fund Management. It’s concentrated in Pune, one IT Park, and two townships. When do these three projects kick in and when do they start contributing to you financially?
A: We have three big projects in Pune with ICICI; one of them is an IT Park in Kharadi, which is 1 million sq. ft. We will be launching that project by November end. Another one is 1.2 million sq. ft. of residential project on Nagar Road, which will be launched in the month of December and third is a biggest township of 400 acre, integrated township in Hinjewadi which will be started somewhere in the month of February-March 2008.
Q: Apart from the ICICI Venture Projects, what are the total projects you are sitting on right now and if you could demark it - how many are residential and how many commercial?
A: We have 28 ongoing projects in Pune and Bangalore. Out of the 28, 23 are residential and 5 are commercial-IT Parks.
Q: Talk about your margins because on YoY basis there is been a significant jump in FY07. Did you book higher revenues in this financial year because margins came up from about 7.8% to 39% and what’s the kind of sense that you are getting right now in terms of how much expansion in margins you can see when you book more revenues from the ongoing projects?
A: In FY07, we completed one of our biggest IT Park, Gigaspace in Pune, which has fetched us higher revenues - that has been the biggest jump in the total revenue. As our average land price is Rs 149; we see a big jump in our profit margins.
Q: You said 1,250 acres. What is the saleable area and what is the reserve that you have?
A: Out of 1,250 acres total saleable area available will be 33 million sq. ft. and out of 33 million sq. ft., 80 million is ongoing and current projects, which will be completed in a span of three-four years and 21 million sq. ft. is our land reserve.
Q: One word on the joint venture that you have with Yatra Capital, which is a Jersey-based real estate fund, the property that you are developing under that?
A: We have three residential projects with Yatra Capital in Pune; one of them is in Kharadi that is 7-lakh sq. ft., another is in Mohammed Wadi and all three are mid-market segment with Yatra Capital. Total area available will be 33 lakh sq. ft.
Excerpts from CNBC-TV18’s exclusive interview with Rajesh Patil:
Q: What is the total amount of money that you require currently?
A: The amount we will be raising from IPO is Rs 275 crore.
Q: Are you doing any kind of pre-IPO placement before the IPO opens or are you also looking at raising debt for your expansion?
A: Definitely, we will be raising debts. Currently the company has debts of Rs 70 crore and future debt requirements will be project specific.
Q: Give us an idea of the joint venture that you have with ICICI Venture Fund Management. It’s concentrated in Pune, one IT Park, and two townships. When do these three projects kick in and when do they start contributing to you financially?
A: We have three big projects in Pune with ICICI; one of them is an IT Park in Kharadi, which is 1 million sq. ft. We will be launching that project by November end. Another one is 1.2 million sq. ft. of residential project on Nagar Road, which will be launched in the month of December and third is a biggest township of 400 acre, integrated township in Hinjewadi which will be started somewhere in the month of February-March 2008.
Q: Apart from the ICICI Venture Projects, what are the total projects you are sitting on right now and if you could demark it - how many are residential and how many commercial?
A: We have 28 ongoing projects in Pune and Bangalore. Out of the 28, 23 are residential and 5 are commercial-IT Parks.
Q: Talk about your margins because on YoY basis there is been a significant jump in FY07. Did you book higher revenues in this financial year because margins came up from about 7.8% to 39% and what’s the kind of sense that you are getting right now in terms of how much expansion in margins you can see when you book more revenues from the ongoing projects?
A: In FY07, we completed one of our biggest IT Park, Gigaspace in Pune, which has fetched us higher revenues - that has been the biggest jump in the total revenue. As our average land price is Rs 149; we see a big jump in our profit margins.
Q: You said 1,250 acres. What is the saleable area and what is the reserve that you have?
A: Out of 1,250 acres total saleable area available will be 33 million sq. ft. and out of 33 million sq. ft., 80 million is ongoing and current projects, which will be completed in a span of three-four years and 21 million sq. ft. is our land reserve.
Q: One word on the joint venture that you have with Yatra Capital, which is a Jersey-based real estate fund, the property that you are developing under that?
A: We have three residential projects with Yatra Capital in Pune; one of them is in Kharadi that is 7-lakh sq. ft., another is in Mohammed Wadi and all three are mid-market segment with Yatra Capital. Total area available will be 33 lakh sq. ft.
What caused Religare, Mundra to oversubscribe so much?
First Religare, and then Mundra closed at about 115x over-subscribed. Both the QIB and HNI were about 150x to 160x oversubscribed. S Subramanian, Head of Investment Banking, Enam Financial Consultants who was the investment banker for both these issues to share what went right with these two issues.
Excerpts from CNBC-TV18’s exclusive interview with S Subramanian:
Q: Where did you see the maximum demand coming in from the QIB and HNI side- if you cannot share names probably geographically?
A: The geographical distributions of the QIB names were so interesting that it’s been equal. We have seen a significant demand come from India. We have seen significant demand also come in from across the three continents, US, Europe and Asia and therefore it is not as if we saw any special or spectacular effort coming in from the US or from Asia or one of the three regions we saw come through. But what's also interesting is that even in India, demand was very strong.
Q: We have heard market buzz last time around that there have been a decent number of Indian pension or provident funds that are also putting money. Did you see that trend continuing?
A: I don’t have exact individual names with me. But the last time we saw that, was in Power Grid offering and I am sure that it would have been here. Unfortunately I don’t have those names right in front of me.
Q: Did this P-note issue have any impact on the kind of investors that actually came in on the quantum that you would have actually expected and did that in any way you think take a backseat?
A: I don’t know whether the people who use normally the P-notes have been able to come in. But we also expected that many of the P-notes instead of the underlying clients could also have been used by the proprietary funds and until recently, they had to give way for the clients. That could have been one reason. But we have also seen a significant number of newer names into the book; so that itself is a good indicator that Mr. Damodaran’s efforts are bearing fruit or will bear fruit.
Q: Can you therefore say with confidence that the primary market will hereafter not be really impacted by the P-note constraints at all?
A: I would not want to say that there is no impact at all. Mundra was a unique case; a case where complete scarcity premium - there is no port in the market in the listed place, there is no port-cum-SEZ in the market-listed place. The valuation was attractive. We have seen people come in at similar valuation. But with a one-year lockup and here is an offer, which is there for people without any lockup. So we think that significant portion of the demand also could have been simply the fundamental reason. So let’s not just move only into the technical part of the whole reason as to why people come in. But there is a fundamental reason why people came into the offering and credit should go more towards that.
Q: What are you factoring in terms of a growth rate when you actually sold this issue because the SEZ comes up only in 2010 and even the Petronet aspect that you are talking about is 50-50 JV. While the point is taken that it is very niche space, but what sort off growth rate did you sell to your investors that this company could essentially grow at that they have bought into these valuations?
A: Effectively, we told our investors this is a sum of parts valuations, this is not only a growth rate. There is growth rate in the port business. There is an SEZ business that is there and these are the way we put together. So it was not a one single story with a growth in it. SEZ business was on a DCF face valuation and the port was on its own valuations. We sold it as a sum of parts valuations.
Q: And your sum of parts comes upto Rs 450 per share?
A: We believe that at sum of parts at the Rs 440 per share, we expected in the Rs 400-440 per share. Investors should in the medium term make money and that was what our recommendation of the price band was, which the company had accepted.
Courtesy: moneycontrol.com
Excerpts from CNBC-TV18’s exclusive interview with S Subramanian:
Q: Where did you see the maximum demand coming in from the QIB and HNI side- if you cannot share names probably geographically?
A: The geographical distributions of the QIB names were so interesting that it’s been equal. We have seen a significant demand come from India. We have seen significant demand also come in from across the three continents, US, Europe and Asia and therefore it is not as if we saw any special or spectacular effort coming in from the US or from Asia or one of the three regions we saw come through. But what's also interesting is that even in India, demand was very strong.
Q: We have heard market buzz last time around that there have been a decent number of Indian pension or provident funds that are also putting money. Did you see that trend continuing?
A: I don’t have exact individual names with me. But the last time we saw that, was in Power Grid offering and I am sure that it would have been here. Unfortunately I don’t have those names right in front of me.
Q: Did this P-note issue have any impact on the kind of investors that actually came in on the quantum that you would have actually expected and did that in any way you think take a backseat?
A: I don’t know whether the people who use normally the P-notes have been able to come in. But we also expected that many of the P-notes instead of the underlying clients could also have been used by the proprietary funds and until recently, they had to give way for the clients. That could have been one reason. But we have also seen a significant number of newer names into the book; so that itself is a good indicator that Mr. Damodaran’s efforts are bearing fruit or will bear fruit.
Q: Can you therefore say with confidence that the primary market will hereafter not be really impacted by the P-note constraints at all?
A: I would not want to say that there is no impact at all. Mundra was a unique case; a case where complete scarcity premium - there is no port in the market in the listed place, there is no port-cum-SEZ in the market-listed place. The valuation was attractive. We have seen people come in at similar valuation. But with a one-year lockup and here is an offer, which is there for people without any lockup. So we think that significant portion of the demand also could have been simply the fundamental reason. So let’s not just move only into the technical part of the whole reason as to why people come in. But there is a fundamental reason why people came into the offering and credit should go more towards that.
Q: What are you factoring in terms of a growth rate when you actually sold this issue because the SEZ comes up only in 2010 and even the Petronet aspect that you are talking about is 50-50 JV. While the point is taken that it is very niche space, but what sort off growth rate did you sell to your investors that this company could essentially grow at that they have bought into these valuations?
A: Effectively, we told our investors this is a sum of parts valuations, this is not only a growth rate. There is growth rate in the port business. There is an SEZ business that is there and these are the way we put together. So it was not a one single story with a growth in it. SEZ business was on a DCF face valuation and the port was on its own valuations. We sold it as a sum of parts valuations.
Q: And your sum of parts comes upto Rs 450 per share?
A: We believe that at sum of parts at the Rs 440 per share, we expected in the Rs 400-440 per share. Investors should in the medium term make money and that was what our recommendation of the price band was, which the company had accepted.
Courtesy: moneycontrol.com
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