HDFC Ltd launches Rs 14,000 crore QIP, at floor price of Rs 1,838.94/share

To raise capital for the smooth functioning of the mortgage lending business, HDFC Ltd has launched a mega Rs 14,000 crore qualified institutional placement (QIP), with floor price of Rs 1,838.94 per equity share. 

HDFC Ltd is the sixth company to raise funds via QIP after Kotak Mahindra Bank, JM Financial, PI Industries, Axis Bank and Info Edge. 

Qualified institutional placement is the widely-used capital raising tool in India where listed companies can raise funds without having to submit legal paperwork to the market regulator. Only parties that are eligible to purchase QIPs are qualified institutional buyers (QIBs)/ accredited investors. 

“The issue price would comprise for an amount aggregating upto Rs 14,000 crore by way of issue of equity shares and warrants and upto Rs 9,000 crore by way of issue of Secured Redeemable Non-Convertible Debentures,” the company said in an exchange filing.

The company in its exchange filing said that it may not offer more than five percent discount of the offered floor price at its absolute discretion.

The QIP will consist of equity share sale of Rs 10,000 crore and sale of warrants worth Rs 4,000 crore. 

New Listing: Mindspace REIT listed with a 10.55 percent premium at Rs 304, over its issue price of Rs 275 on the BSE. It received a good response from the Street. The final issue price was fixed at Rs 275, the upper end of the price band of Rs 274-275. This is the second REIT to list on the exchanges, after Embassy Office Parks REIT which was listed in March 2019 following fundraising of Rs 4,750 crore via IPO. The portion set aside for institutional investors witnessed a subscription of 10.61 times and that of non-institutional investors 15.77 times. It received bids for 87,78,24,600 shares against the total issue size of 6,77,46,400 shares. 

 

Stock Update: Lupin’s US based wholly-owned subsidiary Lupin Inc. has entered into an agreement with ForDoz Pharma Corp (ForDoz) for granting Lupin the exclusive rights to market and distribute 2 complex injectable assets in advanced stages of development in the U.S. and its territories. The stock is trading 5.46 percent lower currently to Rs 885.15 per share on the NSE. 

Trending Stock: Shares of Pidilite Industries climbed over 2 percent even as the company reported a 95 percent year-on-year (YoY) fall in June quarter consolidated net profit at Rs 16 crore. The company’s net sales for the quarter stood at Rs 873 crore, down 56 percent YoY while EBITDA before non-operating income stood at Rs 67 crore, down 85 percent YoY. (Source: Moneycontrol)

REIT Listing | Mindspace Business Parks REIT got listed at Rs 304 on BSE, a 10.55 percent premium over its issue price of Rs 275.

Rupee Update | Indian rupee opened lower at 75.05 per US dollar against the yesterday’s close of 74.93.

Buzzing | Vodafone Idea stock price falls 7% as Q1 net loss widens; CLSA cuts target

Shares of Vodafone Idea declined over 7 percent in the early trade on Friday after the company’s net loss in the first quarter of fiscal 2021 widened to Rs 25,460.20 crore as against a loss of Rs 4,873.90 crore for the corresponding quarter a year ago.

Consolidated revenue during the period declined 5.42 percent to Rs 10,659.3 crore from Rs 11,269.9 crore, YoY. On a sequential basis, the company’s revenue fell by 9.3 percent.  Average Revenue Per User (ARPU) in Q1FY21 dipped to Rs 114 from Rs 121 in Q4FY20. EBITDA was reported at Rs 4,098.4 crore while EBITDA margin stood at 38.5 percent.

Global brokerage CLSA has cut Vodafone Idea’s FY21-22CL forecasts by 1-5 percent and factors in additional cost savings of Rs 4,000 crore.

“Vodafone Idea’s 1QFY21 revenues, down 9% QoQ, were below estimates. ARPU declined 6% QoQ to Rs 114 and Vodafone Idea saw 11.3 million decline in subscribers, hit by closure of retail stores during all-India lockdowns. While voice traffic declined 6% QoQ, encouragingly data traffic was up 11% QoQ,” CLSA said.

The company awaits Supreme Court verdict on AGR, and even if 20 years staggered payment is granted, on DoT estimates, EMI will be 30 percent of cash EBITDA, CLSA said.

CLSA cut the target price to Rs 8.40 from Rs 9.20 per share earlier.

Technical View | We have opened below the levels of 11,200 which indicates that the markets are still not fully convinced on the upside. We would need to get past and close above 11,200 for the markets to enter a bullish zone. To be more specific, we should trade higher than yesterday’s closing which was 11,256. On the downside, a close watch needs to be kept for 11,100 – the breaking of this can derail the market direction and we could see some correction, said Manish Hathiramani, Index Trader and Technical Analyst, Deen Dayal Investments.

Yes Bank’s shares surge over 4% for the third-consecutive day, stock up 17% this week

Yes Bank’s shares surged over 4 percent on Friday for the third consecutive day after media reports indicated that the country’s largest insurer LIC bought shares of the troubled private lender. Also, Moody’s recent upgrade on the private lender is fuelling the rally.

At 9:45 am, the stock gained 4.46 percent to Rs 14.05 per share on the NSE. In the last 5 trading sessions, the stock has surged nearly 17 percent to current levels.

Media reports indicated that about 105.98 shares (4.23 percent stake) were bought through open market. With this deal, LIC’s stake in the private bank has risen to 4.98 percent from 0.75 percent earlier.

Meanwhile, credit rating agency Moody’s Investors Service recent upgrade on the stock has also added fuel to the stock’s recent rally. Moody’s upgraded Yes Bank’s long-term foreign currency issuer rating to ‘B3’ from ‘Caa1’. It has also upgraded the bank’s long-term foreign and local currency bank deposit ratings to ‘B3’ from ‘Caa1.

In fact, the outlook on the Bank has been changed to stable from positive, said the agency report.

One-time loan restructuring: Here’s what brokerages say on RBI’s announcement

Macquarie believes that the new restructuring scheme announced by the RBI is better than last time while Nomura said it was likely the necessary buffer to provide for the stress through the generation of pre-provisioning operating profit. Here’s more on the loan restructuring.

Opening Bell: Market opens lower, Nifty below 11,200; index heavyweights slip, HCL Technologies top loser

The Indian market opened lower on Friday in the opening session dragged by the index heavyweights namely Reliance Industries, HDFC Bank, ICICI Bank and Lupin.

At 09:16 am, the Sensex was down 151.61 points or 0.40 percent at 37873.84, and the Nifty was down 34.00 points or 0.30 percent at 11166.20. About 706 shares have advanced, 335 shares declined, and 50 shares are unchanged.

Except realty, media and FMCG, all sectors traded in the red. Meanwhile, broader markets outperformed the benchmarks, traded in the green.

Technical Experts View: Nischal Maheshwari, CEO-institutional equities & advisory of Centrum Broking suggests two stocks for the day. According to him, most FMCG stocks have been doing well, and on any correction, these stocks should be bought.

His other recommendation is HPCL and BPCL. He feels that the stock has come out with very good numbers. “It was interesting to see the gross refining margins (GRMs) doing pretty well for them. We are going to revise our earnings for the stock. We continue to believe that this is a good place to be in. All refining stocks seem to be in a good place as well as valuation-wise. We prefer BPCL over HPCL,” added Maheshwari. 

Fundamentals to drive HDFC Bank shares; Jagdishan needs to focus on compliance, digital challenges, says Macquarie

The performance of the HDFC Bank share price will be based on the fundamental of the lender, said Macquarie Capital Securities’ Suresh Ganapathy, while adding that Sashidhar Jagdishan needs to focus on compliance issues and digital challenges.

Jagdishan will take the reins from Aditya Puri in October end. The Reserve Bank of India on Tuesday gave its node to his appointment as the CEO of India’s largest private sector bank in terms of market capitalisation.

Macquarie’s Ganapathy further said that Jagdishan executing the current strategy over the next 5 years is not a challenge. Click here to read more

To understand more on the policy rate announcement yesterday, here are some articles for you!

The Reserve Bank of India’s (RBI) Monetary Policy Committee (MPC) kept the repo rate unchanged in the August policy at 4 percent. The reverse repo rate has been maintained at 3.35 percent.

The central bank has maintained its policy stance at “accommodative” which could continue for as long as necessary to revive growth.

Here are the links that would help you understand what were the major announcements from the RBI-MPC yesterday:

1. Plainspeak: Key points from RBI’s policy — translated from jargon to English- click here

2. RBI Monetary Policy: Experts discuss the rationale to keep repo rate unchanged at 4%- click here

3. Explained | How RBI’s loan restructuring scheme for COVID-impacted borrowers will work- click here

Let’s quickly go through the market closing yesterday!

The Indian benchmark equity indices, Sensex and Nifty ended higher Thursday after the announcement of the Reserve Bank of India’s (RBI) monetary policy.

The Sensex ended 362.12 points or 0.96 percent higher at 38,025.45 while the Nifty surged 98.50 points or 0.89 percent to close at 11,200.15. Broader indices participated in the rally with Nifty Midcap gaining over 1 percent and Nifty Smallcap index ending over 0.3 percent higher.

Nifty Bank advanced 133 points to end at 21,643 level. Among sectors, Nifty IT, Nifty Pharma, Nifty Metals, Nifty Financial Services and Nifty FMCG rallied over 1 percent each while Nifty PSU Bank index ended in the red.

Tata Steel, Infosys, GAIL India, Bajaj Finance and UPL led the gains among Nifty constituents while Eicher Motors, Shree Cements, Adani Ports & SEZ M&M and Dr Reddy’s Laboratories were the top index losers. 

Welcome to our market live blog!

This is Mousumi Paul, and I am from the desk team of CNBC-TV18. I will be taking you through all the updates on the corporate world, economy and the stock market. To begin with, the Reserve Bank of India’s Monetary Policy Committee yesterday announced that the key policy rates will remain unchanged. Repo rate at 4 percent and reverse repo rate at 3.35 percent. For more on this- click here!

On the opening bell today, the Indian market is expected to open flat on Friday amidst a mixed trend in the peer markets. At 7:43 am, the SGX Nifty traded 11 points lower at 11,201, indicating a flat start for the Sensex and the Nifty50.