Daily Market Update – Sep 30th

unnamed Daily Market Update   Sep 30th


Serum Institute will get an additional $150 million in funding from Bill & Melinda Gates Foundation This is to manufacture an additional 100 million COVID-19 vaccine doses for India and other lower income countries. Now the enhanced manufacturing capacity of vaccines stands at 200 million doses. The dosage has been priced at an economical Rs.250/dose. The whole is idea is that the vaccines are not cornered by the rich countries but equitably distributed. If successful, the AstraZeneca vaccines will be available in 61 countries while the Novavax vaccines will be made available in 92 countries in all.

SBI Cards, a subsidiary of SBI that recently came out with an IPO earlier this year, joined hands with American Express to offer global benefits and exclusive privileges for Indian consumers. Under this deal, the SBI Card ELITE and SBI Card PRIME will be available on AMEX global network. Cardholders of SBI Elite and SBI Prime will get the added benefits of the AMEX international spread also like Elite Tier membership, complimentary lounge program, access to VIP upgrades, privileges at hotels, restaurants and retail outlets etc. It will also give them pre-ticketing access to marquee events like Wimbledon and US Open. SBI is already the second largest card network in India after HDFC Bank. The cards on AMEX network will be enabled for contactless transactions and protected by SafeKey for online transactions.

The Mazagon Dock IPO got a good response on the first day. The IPO is open for 3 days till October 01 and has a price band of Rs.135-145 per share. The issue got fully subscribed on the first day itself with good response from the retail investors. Mazagon Docks has monopoly status as the only shipyard to build destroyers and conventional submarines for the Indian Navy. It has an order book of Rs.55,000 crore. At the upper price band at Rs.145 per share, the stock is available at a low P/E of 6.1X. The healthy order book position makes the stock doubly attractive. It is likely to get listed in early October.

In a small move towards rapprochement, the Shapoorji Pallonji group will allow Tata group easy terms including staggered payments. Tata Sons will have to shell out over Rs.150,000 crore to buy out the 18.4% stake in Tata Sons. That should hopefully bring to an end the ongoing feud between two of the most powerful Parsi business families in India. The details are expected after the next court hearing on 28 October. The valuation of Tata Sons will be done on four parameters viz. value of listed companies, value of unlisted firms, brand equity and debt. Mistry wants a court appointed independent valuer.

It looks like the Jio Platforms pattern may be repeating all over again in Reliance Retail. After KKR and Silver Lakes bought about 3.03% stake in Reliance Retail Ventures for Rs.13,100 crore, it is now the turn of the Abu Dhabi based Mubadala Investments to infuse another $1 billion into Reliance Retail. All these 3 PE funds were investors in Jio Platforms too. Mubadala is the second largest investor from Abu Dhabi after ADIA and manages close to $240 billion in AUM. Reliance is also in talks with Softbank of Japan as well as Amazon for a strategic stake. The full picture of Reliance Retail is yet to crystallize.

In a swift move towards monetizing the digital properties of the Tata Group, they are in advanced discussions with Wal-Mart of the US to infuse $20-25 billion into the digital super app that is intended to become the driver of Tata digital strategy. The super app will create a digital behemoth offering a wide range of Tata products in the retail space. To begin with, the super app may be housed in a Tata Sons subsidiary. If it happens, then it will be Wal-Mart’s largest investment in India even bigger than their stake in Flipkart. The super app could even be a joint venture between the Tatas and Wal-Mart. Goldman Sachs will advise Wal-Mart and the super app is tentatively valued at $50-60 billion. Above all, it will also mean that they can buyout Pallonji Mistry’s stake in Tata Sons without selling TCS shares.

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