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LIC to File DRHP for Mega IPO in December

LIC to File DRHP for Mega IPO in December
by 5paisa Research Team 17/11/2021

The much talked about LIC IPO may finally see the first step in the first week of December when it files the draft red herring prospectus (DRHP) with SEBI. The LIC IPO has already gone through basic processes like the statutory amendments to the Life Insurance Corporation Act, appointment of merchant bankers, appointment of legal advisors and registrars.

By first week of December, LIC is expected to file the DRHP with the actuarial valuation.

Towards the last week of November, the merchant banker are expected to start talking to the anchor investors to gauge market demand. LIC has already appointed a total of 10 merchant bankers comprising of 5 global investment banks and 5 major Indian investment banks.

LIC will be the largest Indian issue by a margin depending on how much the government eventually plans to sell to the public.

Check - LIC IPO Government Approval

Originally, the DIPAM was to offer 10% to the public but a subsequent amendment allowed the DIPAM to offer even 5% if justified. It is yet to be finalized whether the government will offer 5% or 10% but the final issue size would be based on that.

The final issue size is expected to be in the range of Rs.60,000 crore to Rs.100,000 crore depending on how much the government eventually decides to divest in the IPO.

The embedded valuation based on actuarial value is being done by Milliman Advisors. This actuarial value will form the basis of the embedded valuation of LIC and the pricing would eventually depend on that. The actuarial valuation is expected to be readied by the first week of December post which the DRHP will be filed.

The government of India is keen to push through the IPO before March this year since that would enable the divestment proceeds to be included in the current fiscal year. The government has set an aggressive divestment target of Rs.175,000 crore for this year and that would only be possible if the mega LIC IPO goes through.

There are also other big divestments like that of BPCL that are also pending and are unlikely to happen in this fiscal.

Irrespective of whether the government eventually sells 5% or 10%, this will be the largest IPO in Indian stock market history, much larger than Paytm IPO of Rs.18,300 crore that just closed last week.

Also Read:-

Upcoming IPOs in 2021

Upcoming IPOs in November 2021

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Akasa Air Places Order for $9 Billion Worth of Boeing Planes

by 5paisa Research Team 17/11/2021

Akasa Air, the ultra-low-cost airline backed by Rakesh Jhunjhunwala, has placed orders for a total of 72 Boeing 737 Max airplanes in an order worth $9 billion. This is the largest order that Boeing has received from India and gives them the much needed foothold in the Indian aviation markets.

It may be recollected that the Max-737 had been under regulatory ban and only recently the DGCA had allowed the 737-Max to fly again in India.

The order was finalized and announced at the Dubai Air Show. It is estimated that this price was after a large bulk discount but the exact details of the pricing were not available.

Akasa Air plans to tap the rapid growth in the Indian aviation market by offering an ultra-low-cost offering that would encourage almost every person to fly. It is not yet clear what would be the profitability trajectory or unique positioning of the model.

Check - Akasa Air Gets Approval to Launch Operations

Akasa Air is expected to have its base in Delhi and Bengaluru and will commence operations around June 2022. It is expected to induct 20 aircraft into its fleet in the first year of operation and then gradually add to its fleet.

Most low-cost airlines make money when they are able to fly at full capacity and also churn their flights quickly. In addition, the absence of frills gives them a huge cost advantage.

Akasa Air will look to design a sale and lease back arrangement with a large lessor wherein it would buy the planes from Boeing and then sell the same to an aircraft leasing company and lease it back. This allows them to reduce the capital locked into the business and improve the ROI.

The only catch is that most of these aircraft lease contracts are covered by the “Hell or High Water” clause wherein there is no provision for “Force Majeure”.

For Boeing, this order is a ticket to the lucrative and fast growing Indian aviation market. India’s largest airline, Indigo Airlines with 55% market share, has opted to stick with Airbus aircraft all through. Once the 72 aircraft are procured by Akasa, it will have the fourth largest fleet in India after Indigo, Air India and Spice Jet.

Boeing 737 Max is reputed to deliver the lowest seat mile cost and that would be a big edge in the competitive Indian market.

Also Read - Big Bull Rakesh Jhunjhunwala's Portfolio 2021

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Grey Market Premium of Latent View Analytics IPO

Grey Market Premium of Latent View Analytics IPO
by 5paisa Research Team 17/11/2021

The Rs.600 crore IPO of Latent View Analytics consisted of a fresh issue of Rs.474 crore and an offer for sale at Rs.126 crore. The issue had been priced in the band of Rs.190 to Rs.197 per share and the price has been discovered at Rs.197.

The issue opened for subscription on 10-Nov and closed for subscription on 12-Nov. The issue was subscribed 326.49 times overall. The stock is scheduled to list on Tuesday, 23rd November.

Most of the shares start trading in the grey market well ahead of the IPO opening, which offers important indicators. Ahead of the issue and ahead of listing, one of the key parameters for evaluating the potential IPO is the GMP or the grey market price.

A word of caution here. The GMP is not an official price point, just a popular informal price point. However, in most cases, it has proved to be a good informal gauge of demand and supply for the IPO. Hence it does give a broad idea of how the listing is likely to be and how the post-listing performance would be.

While the GMP is just an informal approximation, it has been generally seen to be a good mirror of the real story. More than the actual price, it is the GMP trend over time that really gives the insights about the stock being upgraded or downgraded over a period of time and which direction the wind is blowing.

Check - Latent View Analytics IPO - Subscription Day 3

One of the key factors that impacts the GMP in most cases, is the extent of oversubscription, and that is huge in this case at 326.49 times. The GMP premiums will largely predicate on the extent of oversubscription in each of the categories. That would make the GMP premiums robust in the informal trading market.

As per updates coming in on Wednesday, 17-Nov, the Latent View Analytics IPO is commanding a premium of Rs.690 over the issue price in the grey market. The GMP has doubled in just last 2 days from Rs.345 levels to Rs.690 levels. Of course, this GMP will keep changing between now and the actual listing date.

The current GMP of Rs.690 for Latent View Analytics IPO translates into a 250.25% premium over the upper price band of Rs.197, which is also the discovered price. It also hints at a listing price of approximately Rs.887 when the stock lists but this would be subject to continuous change.

GMP is an important informal indicator of likely listing price. However, investors must note that this is just an informal indication and has no official sanction.

Also Read:-

Upcoming IPOs in 2021

Upcoming IPOs in November 2021

Latent View Analytics IPO - 7 Things to Know

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Grey Market Premium of Sapphire Foods Ltd IPO

Grey Market Premium of Sapphire Foods Ltd IPO
by 5paisa Research Team 17/11/2021

The Rs.2,073.25 crore IPO of Sapphire Foods Ltd consisted entirely of an offer for sale of Rs.2,073.25 crore. The issue had been priced in the band of Rs.1,120 to Rs.1,180 per share and the price has been discovered at Rs.1,180. The issue opened for subscription on 09-Nov and closed for subscription on 11-Nov.

The issue was subscribed 6.6 times overall. The stock is scheduled to list on Monday, 22nd November. Most of the shares start trading in the grey market well ahead of the IPO opening, which offers important indicators.

Ahead of the issue and ahead of listing, one of the key parameters for evaluating the potential IPO is the GMP or the grey market price.

A word of caution here. The GMP is not an official price point, just a popular informal price point. However, in most cases, it has proved to be a good informal gauge of demand and supply for the IPO. Hence it does give a broad idea of how the listing is likely to be and how the post-listing performance would be.

Check - Sapphire Foods India IPO subscription Day-3

While the GMP is just an informal approximation, it has been generally seen to be a good mirror of the real story. More than the actual price, it is the GMP trend over time that really gives the insights about the stock being upgraded or downgraded over a period of time and which direction the wind is blowing.

One of the key factors that impacts the GMP in most cases, is the extent of oversubscription. The GMP premiums will largely predicate on the extent of oversubscription in each of the categories. That would make the GMP premiums robust in the informal trading market.

As per updates coming in on Wednesday, 17-Nov, the Sapphire Foods Ltd IPO is commanding a premium of Rs.85 over the issue price in the grey market.

The GMP has fallen in the last ten days from Rs.125 levels to Rs.85 levels, where it has stabilized. Of course, this GMP will keep changing on a regular basis till the actual listing happens.

The current GMP of Rs.85 for Sapphire Foods Ltd IPO translates into a 7.20% premium over the upper price band of Rs.1,180, which is also the discovered price. It also hints at a listing price of approximately Rs.1,265 when the stock lists but this would be subject to constant change. GMP is an important informal indicator of likely listing price.

However, investors must keep in mind that this is just an informal indication and has no official sanction.

Also Read:- 

Upcoming IPOs in 2021

Upcoming IPOs in November 2021

Sapphire Foods India IPO - 7 Things to Know

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How to Check Allotment Status of Tarsons Products IPO

How to Check Allotment Status of Tarsons Products IPO
by 5paisa Research Team 18/11/2021

The Rs.1,023.47 crore IPO of Tarsons Products, consisting of a fresh issue of Rs.150 crore and an offer for sale (OFS) of Rs.873.47 crore. The IPO was subscribed 77.49X overall at the close of bidding on 17 November. The basis of allotment will be finalized on 23 November, Tuesday.

If you have applied for the IPO, you can check your allotment status online.

You can either check your allotment status on the BSE website or the IPO registrar, KFINTECH Private Limited (formerly Karvy Computershare). Here are the steps.
 

Checking the allotment status of Tarsons Products on BSE website


Visit the BSE link for the IPO allotment by clicking on the link below https://www.bseindia.com/investors/appli_check.aspx 

Once you reach the page, here are the steps to follow:

1) Under Issue Type – Select Equity Option
2) Under Issue Name – Select Tarsons Products from the drop down box
3) Enter the Application Number exactly as in the acknowledge slip
4) Enter the PAN (10-digit alphanumeric) number
5) Once this is done, you need to click on the Captcha to verity that you are not a robot
6) Finally click on the Search Button

The allotment status will be displayed on the screen in front of you informing about the number of shares of Tarsons Products IPO allotted to you.
 

Checking the allotment status of Tarsons Products on KFINTECH (Registrar to IPO)


Visit the KFINTECH registrar website for IPO status by clicking on the link below:
https://rti.kfintech.com/ipostatus/

Once you click on Recent IPOs, the dropdown will only show the active IPOs, so once the allotment status is finalized, you can select Tarsons Products from the drop down box.

A) There are 3 options. You can either Query the allotment status based on PAN, Application Number or DPID-Client ID combination.

Check - Tarsons Products IPO - Subscription Day 3

I)
 To Query by PAN, check the appropriate box and follow these steps:

i)  Enter the 10-digit PAN number
ii) Enter the 6-digit Captcha Code
iii) Click on Submit button
iv) Allotment status gets displayed on screen

II) To Query by Application Number, check the appropriate box and follow these steps:

i) Select Application Type (ASBA or Non-ASBA)
ii) Enter the Application Number as it is
iii) Enter the 6-digit Captcha Code
iv) Click on Submit button
v) Allotment Status gets displayed on screen

III) To Query by DP-ID, check the appropriate box and follow these steps:

i) Select the depository (NSDL / CDSL)
ii) Enter the DP-ID.
iii) Enter the Client-ID.
iv) Enter the 6-digit Captcha Code.
v) Click on Submit button.
vi) Allotment Status gets displayed on screen.

Also Read:-

Tarsons Products IPO - 7 Things to Know

Upcoming IPOs in 2021

Upcoming IPOs in November 2021

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SEBI Releases Investors Charter with Do's and Don’ts

SEBI Releases Investors Charter with Do's and Don’ts
by 5paisa Research Team 18/11/2021

With the proliferation of investment products in the market and a surfeit of options, investors are spoilt for choice. However, it also means that a competitive landscape forces many salespersons to hard-sell investment products and ideas to investors.

In the process, there is always the risk that it could result in mis-selling of products. To address this issue, SEBI has come out with a detailed investment charter with dos and don’ts for investors.

The charter was first proposed in the Union Budget 2021-22 and has finally seen the light of day on 17-Nov this year. Investors have to be enabled to deal with investments with an understanding of the risks involved and invest in a fair, transparent manner. All the SEBI registered entities will be mandatorily required to adhere to this charter.
 

Rights and responsibilities of investors


The charter clearly lays out the rights and the responsibilities of the investors and here is a gist of the same.

A) Investors have the right to get fair and equitable treatment as participants in the financial market. They also have the right to have their grievances redressed by SEBI, exchanges, depositories etc in a time bound manner. Investors also have the right to expect quality service and unbiased advise from SEBI registered entities like brokers, mutual funds etc.

B) However, investors also have some responsibilities. They are responsible for informing themselves about the risks in any investment by reading the offer document in detail. Investors also have the responsibility to only deal with SEBI registered intermediaries and also ensure updating of their details with the institutions proactively.
 

Dos and Don’ts specified in the Investor Charter


The dos and don’ts are an extension of the rights and responsibilities, just that specific action points are cited more clearly.

I) In the list of Dos, the investor must take the responsibility to read the offer document and familiarize themselves with the risks. They are also required to understand details of the fees charged, brokerage charged and other related charges.

Investors must also make it a point to keep track of their investments by downloading regular statements and maintain a record for reasonable period of time. Investors must also pay advance taxes and file tax returns on time for such investment income.

II) In the list of don’ts, investors must make it a point never to pay in cash and all dealings with brokers must only be done via cheque, DD or NEFT where there is an audit trail. The investor must never share sensitive information like trading password, username and other details in their own interest.

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