India's GDP slows, loses fastest growing economy tag

Note ban blues.  India's GDP growth stood at 5.7% in Apr-Jun and pitting the country behind China on the list of world’s fastest growing major economies. 

The 5.7% fiscal first quarter GDP growth, of an economy desperately trying to recover from the shocking impact of demonetisation, was much lower than the 7.9% seen in the same quarter a year ago. 

Immediately after the note ban noted economist Dr manmohan Singh had said that India's GDP will take a hit 2 %. This has come true.

Fiis turn net buyers in cash market

After many days of net selling in cash market, Fiis have turned net buyer in today's trade. They have net bought for Rs 78 cr and Diis have also net bought for Rs 510 cr in the same segment.  Fiis have net bought in index futures, stock futures and index options, indicating upward movement of indices in the next 2-3 trading sessions, barring geopolitical tensions.

Ujjivan Small Finance Bank gets scheduled bank status, stock surges 10%

Ujjivan Small Finance Bank has been included in the Second Schedule to the Reserve Bank of India Act, 1934. With this, Ujjivan has attained the status of a Scheduled Bank.

Bank's shares closed 10% higher at Rs 358 in yesterday's trading.

Demonetization : A damp squib

Reserve Bank of India  has confirmed that  people have returned almost 99% of the scrapped Rs 1,000 and Rs 500 notes after  demonetisation, effectively putting a question mark over the government gaining handsomely by the unreturned money turning into a special dividend by the central bank.

In its annual report, the RBI also said the face value of fake high-value notes was minuscule at Rs 41 crore.

The central bank said people had returned Rs 15.28 lakh crore of the Rs 15.44 lakh crore banned currency, or 99% of the scrapped Rs 500 and Rs 1,000 notes, to the banking system.

New launches to take Apple stock beyond $175

Excitement around Apple at the moment is mostly focused on expectations for a September launch event expected to include a new, premium iPhone that arrives on the 10th anniversary of Apple’s first smartphone and is expected to cost more than previous models.

The stock closed at $162.91, a new 52 week high. New launches including iPhone 8 will take the stock price beyond $ 175 in the coming weeks.

Aurobindo gets USFDA nod

Aurobindo Pharma gets US FDA nod for Cholesterol Drug, Ezetimibe Tablet.
The stock in yesterday's trading closed at Rs 729, down Rs 14.

IPO ANALYSIS : A&M Febcon Limited - Avoid

Issue details:

Issue opens / closes on	01-09 / 06-09-2017
Issue Size	37,12,000 equity shares
Face Value	Rs 10
Price Band	Rs 18
BUSINESS	Industrial equipment / metal fabrication
Promoter	Mrs P P Zalak, Mrs R R Shah
LISTINGS	Bse sme
BRLMs	Gretex Corporate Services
REGISTRAR	Karvy

IPO ANALYSIS : Dhruv Wellness Limited - Avoid

Issue details:

Issue opens / closes on	31-08 / 04-09-2017
Issue Size	27,84,000 equity shares
Face Value	Rs 10
Price Band	Rs 20
BUSINESS	Trading / wholesale distribution of pharma products
Promoter	PRAVINKUMAR PRAJAPATI AND MRS.ANITA PRAJAPATI
LISTINGS	Bse sme
BRLMs	Gretex Corporate Services
REGISTRAR	Purva Share Registry

Apple may launch iPhone 8 on Sept 12

Apple is likely to host a product launch event on September 12, where it will  unveil the iPhone 8, along with two more iPhones and next-generation Apple Watch. Apple, which has been using the Bill Graham Civic Auditorium in San Francisco for the past two years, is said to host its latest event in Steve Jobs Theater instead.

Violation of SCORES : Sebi fines 6 companies.

Sebi has fined 6 companies -Adam Comsof, Akash Agencies, Alert Petrogas, Arun Mantex, Bhavi Investments and Bhagwati Cottons, Rs 10 lakh each for violating SCORES norms.

Isha foundation building unauthorised

Isha Foundation in Coimbatore is facing the heat after the State government informed the Madras High Court that the organisation had constructed buildings without obtaining mandatory permissions.

In the counter affidavit filed before the court on Wednesday, the Deputy Director of Town and Country Planning, Coimbatore Region, said the foundation had built structures spread across alarming plinth area without permission.

The counter confirmed that the villages come under the Hill Area Conservation Authority, adding that the Town and Country Planning authorities has directed Isha Foundation to submit the details on the purpose of establishing the Shiva statue, which was Prime Minister Modi unveiled few years ago. 

IPO ANALYSIS : Dixon Technologies (India) Limited - Aggressively priced - Avoid

Issue details:

Issue opens / closes on	06-09 / 08-09-2017
Issue Size	Fresh of equity of Rs 60 cr + OFS of 30,53,675 equity shares
Face Value	Rs 10
Price Band	Rs 1760-1766
BUSINESS	Contract mfrs of consumer durables, home appliances, lighting and mobile phones
Promoter	Sunil Vachani
LISTINGS	Bse, Nse
BRLMs	IDFC Bank, IIFL Holdings, Motilal Oswal, Yes securities
REGISTRAR	Karvy

Business :

Dixon is an  design-focused products and solutions company engaged in manufacturing products in the lighting, consumer electronics, home appliances, reverse logistics and mobile phones verticals.

Dixon is a fully integrated end-to-end product and solution suite to original equipment manufacturers  ranging from global sourcing, manufacturing, quality testing and packaging to logistics. They are also a leading Original Design Manufacturer of lighting products, LED TVs and semi-automatic washing machines in India.

Risk factors :

1. Top 5 customers accounts for almost 80% of the total revenues.
2. Operates in fast changing consumer product preferences.
3. More than 80% of the components were imported in FY 17, particularly from China.
4. Operates in a highly competitive industry.  
5. The company has not entered into any definitive arrangements to utilize certain portions of the net proceeds of the Offer. The funding requirements and deployment of the Net Proceeds of the Offer are based on management estimates and have not been independently appraised, and are not subject to monitoring by any independent monitoring agency.

Strengths:

1. Leading player in most verticals they operate in.
2. End to end solutions provider with dedicated research and development capabilities.
3. Good financial performance so far.

Recommendations:

The company reported an EPS of Rs 49 for FY17. The offer is made at 36 PE, which is expensive for an enterprise which is into contract manufacturing and does not own any brand. Company operates in highly competitive and fast changing consumer preference segment.

Avoid the IPO as it has been irrationally priced.

Forthcoming IPO : FUTURE SUPPLY CHAIN SOLUTIONS LIMITED

 

Issue details:

Issue Size	97,84, 570 equity shares
Face Value	Rs 10
BUSINESS	Third party logistic services
Promoter	Future Enterprises
LISTINGS
BRLMs	Edelweiss, CLSA, Nomura, IDFC Bank, IIFL Holdings,Yes Securities
REGISTRAR	Link Intime

IPO ANALYSIS : BHARAT ROAD NETWORK LIMITED - Unstable network - Avoid

  

Issue details:

Issue opens / closes on	06-9 / 09-09-2017
Issue Size	2,93,00,000 equity shares
Face Value	Rs 10
Price band	Rs 195-205
BUSINESS	Road BOT Company
Promoter	SREI Infra Finance
LISTINGS	Bse, Nse
BRLMs	Inga Capital,  Investec Capital Services
REGISTRAR	Karvy

Business :

Bharat Road Network is a road build-operate- transfer BOT company in India focused on development, implementation, operation, and maintenance of roads and highways projects. The company is involved in the development, operation and maintenance of national and state highways in several states in India with projects in Uttar Pradesh, Kerala, Haryana, Madhya Pradesh, Maharashtra and Odisha through partnerships with experienced EPC players in the local space where the project is located.

The company’s portfolio includes six BOT projects, of which two are operational under final COD (date of commencement of commercial operation), three are operational under provisional COD, and one is under construction. 

Risk factors : 

1.  Negative net cash flows from operating activities.
2.  Reported losses in the last 3 years.
3.  Business is highly dependent on projects awarded by Government entities. 
4.   Projects which was under construction has been foreclosed by NHAI, due to delay in implementation.
5. Subsidiaries shares are pledged to bankers for securing loans.
6. Tax dues are not paid.
7. Group companies / subsidiaries have incurred losses in the last 2-3 years.
8. Net proceeds of the IPO will be utilised for reduction of debt.

Recommendations.

Avoid the IPO. 

IPO ANALYSIS : SHISH INDUSTRIES LIMITED - AVOID

Issue details:

Issue opens / closes on	23-8 / 28-08-2017
Issue Size	13,52,000 equity shares
Face Value	Rs 10
Price band	Rs 30
BUSINESS	Mfrs of Multi Wall Boards
Promoter	SATISHKUMAR MANIYA AND MR. RAMESHBHAI KAKADIYA
LISTINGS	Bse sme
BRLMs	Corporate Capital Ventures
REGISTRAR	Big Share

POSCO eyes Essar Steeel

South Korean steel manufacturer Posco may consider bidding for debt-ridden Essar Steel, currently facing proceedings under the Insolvency and Bankruptcy Code.

Essar Steel's debt in 2015-16 financial year stood at Rs 38,000 crore.

Forthcoming IPO : Bandhan Bank

Kolkata headquartered Bandhan Bank has initiated its public listing process and it is expected to file DRHP with SEBI before Oct, this year.

The company  is planning to raise around Rs 5000 cr through the IPO.

Bandhan Bank currently has 841 branches pan India, Rs 23500 cr deposits, Rs 22,000 loan book and has 25,000 employees on its roll.

Bandhan is a specialist microfinance bank.