The DIPAM has confirmed that the current IPO approval given by SEBI for the LIC IPO is valid till 12th May. That means; the current approval can be used till 12-May, but if that deadline is missed then fresh papers have to be filed with SEBI. That almost looks like an acknowledgement that the LIC IPO has been put off to the next fiscal year. The IPO entails an offer for sale of 31.6 core shares worth around Rs.65,000 crore.
That surely means that the disinvestment target of Rs.78,000 crore will fall short to the extent of LIC IPO.
For FY22 (Apr-Feb), India’s gold imports surged 73% to $45.10 billion on the back of higher demand. In comparison, gold imports stood at $ $26.11 billion in the same period in FY21. This has been largely the cause of trade deficit for the first 11 months, widening to $176 billion in FY22. This was on account of the rising gold demand from jewellers. In volume terms, the gold imports in the Apr-Feb 2022 period stood at 842.28 tonnes. Gold imports in the first 11 months have normally ranged from 690 tonnes to 890 tonnes.
Despite the pullback in stock markets last week, there was no respite in FPI selling. FPIs sold Rs.45,608 crore in Indian markets till 11th March. Effectively, FPIs pulled out Rs.41,168 crore from equities and Rs.4,431 crore from bonds. The trend of FPI selling started in Oct-21 and this is the 6th month in succession that FPIs have been net sellers. There is risk-off across Asia. FPIs sold $7.09 billion in Taiwan, $2.67 billion in South Korea and $426 million in Indonesia. In last few months, selling was seen across IT and financials.
Ruchi Soya, owned by Patanjali group, will launch a follow-on public offer (FPO) worth Rs.4,300 crore on 24th March. The FPO closes on 28th March. This will help them comply with the 25% public shareholding requirement. Currently Patanjali group owns 98.9% in Ruchi Soya while the public owns 1.1%. Post this IPO, the stake of Patanjali will come down to 81%, while public will hold 19%. Proceeds from the FPO will be utilized to expand business, repay outstanding loans and meet residual working capital requirements.
There are some interesting prospects emerging to take over beleaguered Reliance Capital. Adani Finserv, KKR, Piramal Finance and Poonawala Finance are among 14 prominent potential buyers to bid for RCAP. RBI has fixed 25-March as the last date to submit bids. This will be the third large NBFC to be referred to the NCLT by the RBI; the other two being Dewan Housing and SREI. Bidders can either bid for entire RCAP or one or more of the 8 subsidiaries. Reliance Capital has overall debt of Rs.40,000 crore and big losses.
GAIL India declared 2nd interim dividend of 50% or Rs.5 per share for FY22. This will entail a total dividend pay-out of Rs.2,220 crore with record date of 22nd March. GAIL has already declared first interim dividend of Rs.4 per share. For the year so far, GAIL has paid out Rs.9 per share or Rs.3,997 crore in aggregate. Most of the PSU companies in the oil and gas sector have used record profits amidst rising commodity prices to pay out generous dividends. For the government, this has been instrumental in ensuring dividend stream.
With the crisis in Russia, Tata Steel is seeking alternative sources of coal supply since Russia has been the major source of coal for plants in Europe. The Black Sea embargo made it tough for Russia to ensure supply chain smoothness. Tata Steel used to buy about 15% of its coal from Russia and they may look at North America as an alternative for Europe operations while India may source coal from Australia. T V Narendran of Tata Steel expects operating margins to improve with price increases exceeding the input cost spikes.
RBI has confirmed that it has lifted all restrictions on HDFC Bank. This allows the bank to launch new digital products. It may be recollected that in Dec-20, HDFC Bank had been asked by RBI to halt launches under its digital banking initiative and stop sourcing new credit card customers. The restrictions on credit card issue has already been withdrawn about 6 months back. Post the RBI allowing HDFC Bank to issue fresh cards, they have been very aggressive in the business. Now HDFC Bank can offer the full suite of services.