Key Stocks to Monitor: Hindalco, ZEE, Devyani International, Union Bank of India, Power Finance Corp
On Wednesday, February 21, 2024, the NSE Nifty 50, which is currently hovering at record-high levels, is expected to start trading quietly due to positive signals from foreign markets. At 7:30 AM, Gift Nifty futures were valued at approximately 22,265, compared to the spot Nifty's previous close of 22,197.
Hindalco Industries: The Aditya Birla group has announced that it will take its US-based subsidiary, Novelis Inc., public after 17 years of acquiring it. Novelis is the top aluminium maker for the company, responsible for over 50 percent of its revenue. The announcement came as a surprise on Tuesday, with Novelis revealing that it had submitted a confidential filing for an initial public offering (IPO) with the US Securities and Exchange Commission (SEC). The IPO will consist of a secondary sale of shares by Hindalco, who owns 100 percent of Novelis, and Novelis itself will not receive any capital as part of the offer.
Zee Entertainment Enterprises: On February 20, Zee Entertainment issued a clarification denying reports of restarting discussions with the Sony group to revive their $10-billion merger deal that was scrapped on January 22. In a regulatory filing to the stock exchanges, Zee Entertainment stated that the company is not involved in any negotiations on the Sony merger deal. The reports suggesting a revival of talks are factually incorrect.
Devyani International: Yum Restaurants India plans to sell all of its 4.4 percent stake in the quick service restaurant company, Devyani International. According to sources, the company will raise Rs 814.8 crore through a block deal, with a fixed floor price of Rs 153.5 per share. This is a 7.6 percent discount to Devyani International's closing price on Tuesday. As of December 30, Yum Restaurants India held 5 crore shares in Devyani International. Devyani International is the biggest franchisee for Yum Brands, which operates KFC, Pizza Hut, and Taco Bell in India, and the exclusive franchisee for Costa Coffee.
Union Bank of India: The public sector lender on Tuesday said the Committee of Directors for Raising Capital Funds has approved the raising of funds up to Rs 3,000 crore via qualified institutions placement (QIP), it announced in an exchange filing. Union Bank of India said it approved the floor price of Rs 142.78 per equity share for the issue and approved the opening of the issue today, i.e. February 20, 2024.
Power Finance Corp: The state-run company on Tuesday signed a memorandum of understanding (MoU) with the Goa government to fund the state’s green energy ambitions through a blended finance facility. Under the MoU, PFC will provide financial support for Goa’s pivotal climate-related projects. These include initiatives in renewable energy, green hydrogen, electric vehicles, converting waste to wealth, and nature-based solutions, all contributing to an energy transition.
Reliance Industries, Tata Power, Adani Power, Vedanta: According to a report by news agency Reuters, the Indian government plans to increase the amount of electricity generated from sources that don't produce carbon dioxide emissions by inviting private firms to invest around $26 billion in the nuclear energy sector. The government is currently in talks with at least five private firms, including Reliance Industries, Tata Power, Adani Power and Vedanta, to invest approximately Rs 44,000 crore each. The Department of Atomic Energy and state-run Nuclear Power Corp of India Ltd (NPCIL) have held multiple rounds of discussions with the private companies in the past year on the investment plan.
JSW Steel, Tata Steel, ACC, JK Cement: Twenty-seven companies have submitted bids for coal mines in the latest round of coal mine auctions, which included the ninth round and the second attempt for the seventh round. The Union Ministry of Coal has announced that a total of 27 mines were on offer in the ninth round, but bids were received only for 13 mines. Rungta Sons submitted the highest number of bids, with bids for five mines, followed by JSW Steel and JK Cement, which submitted bids for four mines each. Tata Steel bid for two mines and ACC placed bids for one mine.
HDFC Bank: On Monday, Sashidhar Jagdishan, the CEO of India's largest private sector lender, stated that the bank does not plan to grow just for the sake of market share, after facing investor criticism over lower-than-expected margins in the December quarter. Jagdishan emphasized that the bank is not aiming for quantity and that they do not want to grow just for the sake of market share. This philosophy is not new. He also pointed out the bank's consistent performance in net interest margins, which have remained in the range of 4-4.4 percent over the years, except for the integration effects of the HDFC merger.
EIH: The Supreme Court has upheld an order from the Himachal Pradesh High Court that requires East India Hotels (EIH) to vacate and hand over the Wildflower Hall hotel in Mashobra, Shimla to the state government by March 2025. EIH holds a 78.79 percent stake in Mashobra Resort (MRL), which operates Wildflower Hall. In the annual report of EIH, Mashobra Resort reported an increase in revenue from Rs 73.85 crore to Rs 80.23 crore in FY23. However, it also reported a loss of Rs 30.55 crore in FY23 compared to a net profit of Rs 28.46 crore in FY22.
JSW Group: The JSW Group, led by Sajjan Jindal, is seeking to enter India's third-largest automotive market quickly. They are considering forming partnerships with more than one automotive original equipment manufacturer (OEM) in India. According to sources, the $23-billion conglomerate is exploring two potential alliances: one with Volkswagen Group, the world’s second-largest automotive manufacturer, and the other with state-owned SAIC of China. JSW has already signed a share purchase agreement with SAIC, the parent company of MG Motor India, to establish a joint venture with a 35 percent equity stake. However, they are also in talks with Volkswagen to establish another joint venture.
