Indian Stock Market News 5th September 2024
RailTel Corporation of India gears up for a big opportunity with its preparations to participate in a major government tender for the KAVACH system in locomotives. The over ₹7,000 crore tender is scheduled to open on September 19, 2024, marking a critical milestone for the central public sector undertaking.
The Narendra Modi government recently accorded ‘Navratna’ status to RailTel Corporation of India Ltd, along with Satluj Jal Vidyut Nigam (SJVN) Ltd, NHPC Ltd, and Solar Energy Corporation of India Ltd. Accorded on August 30, this prestige accorded puts the company at 22nd position in the list of ‘Navratna’ in India and continues to raise its competitive profile.
In an interview to CNBC TV-18, Sanjai Kumar, Chairman and Managing Director of RailTel, said, “Navratna status, per se, may give us an advantage in many tenders where we are bidding.” And with this new status, RailTel is better positioned for the KAVACH tender, which should provide an edge in getting this major contract.
Exide Industries Ltd said Arun Mittal, Managing Director and Chief Executive Officer of its Wholly-owned subsidiary, Exide Energy Solutions Ltd., resigned. Mittal would cease to be the Managing Director and CEO, with effect from closure of business hours on October 31, 2024. He has submitted his resignation due to personal reasons. His move will mark the end of his tenure at the helm of affairs of EESL, who at the helm of affairs played an important role in steering the company through a transformation phase in the energy storage and EV sectors.
He will be succeeded by Mandar V. Deo, who is currently serving as Joint Managing Director of EESL. Mandar will assume the charge of MD and CEO of the Company with effect from November 1, 2024. This development has come at a time when Exide Industries is rapidly expanding its presence in the EV and energy storage market.
In August this year, Exide Industries infused ₹74.99 crore into EESL through strategic investment. The investment, by way of subscription of equity shares on a rights basis, underlines Exide’s commitment to enhancing its subsidiary’s capabilities in advanced battery chemistry such as cylindrical, pouch, and prismatic batteries. EESL has fared well in FY24, with a turnover of ₹239.14 crore and a net worth of ₹1,981.56 crore, thus positioning it to leverage the fast-expanding demand for energy storage solutions in India.
The government is selling up to 6.78 per cent of its stake in General Insurance Corporation, GIC Re, through Offer for Sale. The floor price for the sale has been fixed at ₹395 per share and the offer opens on September 4, 2024, for institutional investors, while it would open on September 5, 2024, for retail investors.
The sale is composed of 3.39% equity dilution and up to another 3.39% as a green shoe option. At the floor price of ₹395 a share, OFS would yield approximately ₹4,700 crore for the government. On September 3, the GIC Re share closed at ₹421.25 on BSE; the floor price was a 6.23% discount to the market price.
GIC Re has been an important player in the global reinsurance market, being a 100% state-owned company and a national reinsurer. The government stake in GIC Re is currently 85.78% after its IPO in October 2017, which had fetched ₹9,685 crore. The OFS would give the government an opportunity to raise more funds while giving investors an opportunity to acquire shares in a leading reinsurance firm.
Vedanta Limited plans a strategic consolidation of the display glass business through AvanStrate Inc. (ASI), positioning the firm for ten times growth in the global market. Recently, Vedanta raised its stake in ASI to 98% by buying 46.57% equity from Hoya Corporation, assuming full ownership of the Japanese display glass manufacturer.
ASI specializes in the design and manufacturing of state-of-the-art glass substrates for TFT LCDs-thin-film-transistor liquid-crystal displays. The company is now positioned to be at the forefront of innovation, with further extension of production capacity to meet the rising global demand of such high-tech display products. ASI has production plants in Taiwan and Korea, along with research and development based in Tokyo. ASI will be perfectly positioned to take advantage of growing demand across consumer electronics, automotive, and healthcare markets for advances in display technology.
Thus, at AvanStrate, we are in a good position to better its operational efficiency and innovation capability by infusing Vedanta’s expertise in large-scale operations and deep understanding of the dynamic market,” said Akarsh Hebbar, Global Managing Director, AvanStrate Inc.
The strategic move by Vedanta is in line with its broader vision to expand in the high-technology portfolio. AvanStrate will be positioned with the already existing optical fiber business of Sterlite Technologies Ltd (STL). With this, Vedanta and ASI would emerge as leading players in driving innovation and growth in response to the surging global demand for advanced display technologies.
On Wednesday, Zomato shares jumped 7.7% in early deals to ₹261.60 each following the positive forecast by global brokerage firm JP Morgan. The brokerage firm raised the target price for Zomato to ₹340 from ₹208 per share earlier, implying a 40% upside from the previous closing price of ₹242.
JP Morgan is bullish on Zomato, as Blinkit, its quick-commerce arm, has scaled well across metro cities. The brokerage sees Blinkit contributing meaningfully towards Zomato monetization in the near term through channel margins and advertising revenue. Better store-level economics are likely to further boost the company’s EBITDA outlook.
JP Morgan has cut its earnings estimate for Zomato by 15-41% for FY25-27, factoring in the fast-growing “Going Out” business, which now houses core dining and Zomato’s newly acquired ticketing business. CLSA has highlighted Zomato as its top consumer pick in India, with Blinkit gaining market share at an exceptional growth rate seen as a key driver of profitability going forward for the company.
With Zomato continuing to build scale in the fast-moving worlds of food delivery and quick commerce in India, investor confidence in its long-term growth prospects remains intact.
Tata Motors has been awarded the esteemed Global NCAP Safer Choice Award 2024 for their premium SUVs, the Tata Harrier and Tata Safari. Last year, both the Tata Harrier and Tata Safari secured a five-star Global NCAP rating, considered to be the highest, in various crash tests for adult and child occupant protection.
The new award follows the fulfillment of performance and volume requirements encompassing AEB, speed assistance, and BSD systems across the vehicle line-up. This is recognition for Tata Motors’ safety commitment. Tested for safety, the Safari and Harrier both displayed a good restraint system coupled with a stable structure that offered excellent protection in testing.
Mohan Savarkar, the Vice-President and Chief Product Officer of Tata Motors Passenger Vehicles Limited said while receiving the award: “We are proud to receive this Global NCAP Safer Choice Award for our flagships SUVs, the Tata Safari and the Tata Harrier. This award is reflection of our relentless commitment to safety and a continued commitment to making every vehicle we make to be safe.”.
While Tata Motors has always been keen on emphasizing safety in the design of its vehicles, the company remains at the forefront of promoting safer driving experiences for consumers in India and beyond.
Allied Blenders and Distillers Ltd, which owns the Officer’s Choice whisky brand, will create a new entity in which it will hold 80%, with Bollywood actor Ranveer Singh. The firm, which the company proposes to set up in association with Oh Five Oh Talent Limited Liability Partnership, will manufacture, distribute, license and market luxury and premium spirits.
The acquisition for up to ₹70 crore is thus a strategic deal for ABDL, which looks at deeper inroads into the premium alcoholic beverages segment. A partnership with Ranveer Singh, an icon in Indian entertainment, should further add sheen to the brand and ensure growth in the luxury spirits category.
ADBL said in an exchange statement, “The proposed acquisition is not a related party transaction, as defined under the regulations. The proposed new company will endeavor to create by mutual combining of respective expertise a strong foothold in the premium spirits segment.
With the strategic partnership with Ranveer Singh, new avenues for growth and expansion of the ABDL brands would open as the Indian alcoholic beverages industry evolves.
UPL Ltd said on Monday that its Board of Directors has given in-principal approval to consider all available options that could potentially unlock value in its subsidiary Advanta Enterprises Ltd. The move is part of a broader strategy by UPL to maximize shareholder value by monetizing its stake in the seeds business.
Advanta Enterprises, consequent to the demerger from UPL for facilitating value unlocking, would consider raising funds by issue of securities in one or more primary and/or secondary issuances, private placement and /or combination thereof. The Company shall make further disclosures once the definitive proposals are finalised.
There were reports in the beginning of this year that UPL was weighing an IPO for Advanta in FY25, and was seeking a valuation of $4 billion for the seeds business. UPL has 86.7% stake in Advanta, while private equity firm KKR owns 13.3%.
Advanta declared an income of ₹3,558 crore and EBITDA of ₹921 crore for the fiscal year 2023. The proposed IPO of Advanta will be an important milestone in the growth trajectory of the company as UPL continues to look at opportunities regarding value unlocking.
The Government of Karnataka removed its earlier ban that prevented its departments from conducting business with State Bank of India and Punjab National Bank. The decision has been taken following the recovery of an embezzled amount of ₹22.67 crore along with a year’s interest from both the banks.
On August 12, 2024, the state government had issued the initial ban, in which the State Finance Department requested all government departments, boards, corporations, universities, local bodies, and public sector undertakings to dissociate themselves from SBI and PNB, citing the implementation regarding the apparent misappropriation of funds by these two banks. It was announced that the state government would take immediate action to recover losses.
After the restoration of the money, the Karnataka government has lifted the ban and allowed its departments to resume business transactions with the two banks. The whole incident just underlines the seriousness of the state to ensure accountability in the matter of money and how strongly it tries to maintain stringent oversight in public sector dealing.
Nykaa, the leading beauty and fashion retailer, filed a suit against its former chief business officer Gopal Asthana with breaching confidentiality, misappropriation of proprietary data, and attempting to harm its business. Asthana, currently the CEO of Tata Cliq, approached several Nykaa employees to join him at Tata Cliq; reportedly some of them have already switched in the last one year.
Nykaa stated in its petition before the Bombay High Court that Asthana got enough compensation on his posting at the company and included long-term incentives in the form of stock options as well. The petition also added that because Asthana was at a senior position, he got hold of confidential business data and misused them.
The Bombay High Court has passed an interim order to restrain Asthana from hiring executives for Tata Cliq from Nykaa. Nykaa, represented by CEO Falguni Nayar, has sought refund of ₹19 crore in employee stock option benefits availed by Asthana, apart from an additional ₹5 crore for loss of goodwill and other business metrics.
As the case works its way through the courts, however, it underlines how competitive fashion and beauty etailing in India has become, with Nykaa battling neck and neck with Tata Cliq, Flipkart’s Myntra, Amazon Fashion, and Reliance Ajio.
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Source: Google
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