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Reliance fixes Record Date for Paying Final Call on Partly Paid Shares

Reliance Partly Paid Shares
by 5paisa Research Team 28/10/2021

It may be recollected that last year when Reliance had come out with its Rs.53,124 crore rights issue, the allotment money was payable in three tranches over a period of 18 months. As a result, during this period, the Reliance stock had dual trading in the form of fully paid up regular shares and partly-paid up shares. Now RIL has made the call for the last tranche.

Reliance Industries has now fixed 10-November as the record date to determine the holders of partly-paid shares for paying final call amount. Based on the names that appear on the record on 10-November, the holders of partly paid up shares will be required to pay Rs.628.50 per share as the balance amount between 15-November and 29-November.

Once that process is completed, all shares of Reliance Industries outstanding in the market will only be fully paid up shares and the partly paid shares will stand extinguished. The partly paid shares are currently quoting at a discount to the equivalent fully paid up stock. On 09-November, the trading in partly paid up shares will be suspended.

Reliance Industry - Rights Issue

Reliance had come out with the rights issue in May 2020 and allotted a total of 42.26 crore partly paid shares to investors as the first tranche of the rights issue. Only 25% of the amount was payable in the first tranche. The second tranche was made payable as of 11-May, when a call was made for another 25% at a price of Rs.314.25 per share.

The November 2021 call will be the final call for shareholders and will entail payment of the balance 50% of the right issue payment or Rs.628.50 per share. In short while Rs.628.50 was paid in two tranches in Jun-20 and in May-21, the last tranche of Rs.628.50 per share will be payable between 15-November and 29-November.

The last tranche of the rights will be worth a little over Rs.26,000 crore of which the Ambani promoter family itself will pay close to Rs.13,000 crore. As part of the rights issue, the Ambani family had said that they would not forfeit any of their rights and will also be willing to take up any residual rights not taken up by other shareholders. The Ambani family through individuals, PAC and trusts hold 50.61% stake in Reliance Industries.

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Exide Industries Ltd and Voltas Ltd Share Q2 Result

Exide Industries Ltd and Voltas Ltd Share Q2 Result
by 5paisa Research Team 29/10/2021

Exide Industries Ltd - Q2 Results

Exide Industries Ltd has posted a healthy 18.62% growth in total revenues for the Sep-21 second quarter of the fiscal at Rs.4,758 crore. Even if you look at revenues on a sequential basis, the revenues were higher by 33.68% on a quarter on quarter basis. Here is a gist of the financials of Exide Industries.

 

Rs in Crore

Sep-21

Sep-20

YOY

Jun-21

QOQ

Total Income (Rs cr)

₹ 4,758

₹ 4,011

18.62%

₹ 3,559

33.68%

Net Profit (Rs cr)

₹ 196

₹ 257

-23.62%

₹ 33

497.60%

Diluted EPS (Rs)

₹ 2.31

₹ 3.03

 

₹ 0.39

 

Net Margins

4.13%

6.41%

 

0.92%

 

 

In terms of verticals of the company, revenues from storage batteries and allied product grew sharply by 19% at Rs.3,384 crore. The other insurance business, which has now been sold to HDFC Life, also saw its revenues surge by 17% at Rs.1,369 crore. The top line revenue growth in the quarter was led by both the verticals amidst favourable market conditions.

Net profits of Exide Industries for the Sep-21 quarter actually fell by -23.62% at Rs.196 crore although it would have jumped by nearly 500% compared to the profits in the sequential quarter of June 2021. In terms of yoy growth, the EBIT of the storage batteries vertical grew by 6% at Rs.317 crore which was lower than expected. 

The battery segment EBIT could have been much better had it not been for the 40% spike in input and raw material related costs. The insurance business actually made an EBIT loss due to a surge in COVID related claims and provisions. Net margins at 4.13% was lower than 6.41% in Sep-20 quarter but much better than a measly 0.92% in Jun-21 quarter.

Voltas Ltd - Q2 Results

Voltas, one of the oldest surviving cooling brands in India, reported a very tepid 4.75% growth in total revenues on a yoy basis at Rs.1,689 crore in the Sep-21 quarter. The revenues were, however lower by -5.38% quarter on quarter basis due to supply chain constraints hitting the auto sector this quarter, including the shortage of microchips.

In terms of top line growth of verticals, it was the unitary cooling products vertical that witnessed 33% growth at Rs.1,006 crore while electro mechanical projects saw revenues fall sharply by about 28% at Rs.536 crore. Here is a gist of the financial numbers of Voltas Ltd for the current and comparable quarters.

Rs in Crore

Sep-21

Sep-20

YOY

Jun-21

QOQ

Total Income (Rs cr)

₹ 1,689.08

₹ 1,612.54

4.75%

₹ 1,785.20

-5.38%

Net Profit (Rs cr)

₹ 103.61

₹ 78.35

32.24%

₹ 121.80

-14.93%

Diluted EPS (Rs)

₹ 3.13

₹ 2.37

 

₹ 3.68

 

Net Margins

6.13%

4.86%

 

6.82%

 

 

Net profits of Voltas for the Sep-21 quarter was up 32.24% at Rs.104 crore. The big boost to the EBIT came from unitary cooling products which saw EBIT increase meaningfully from Rs.86 crore to Rs.102 crore. Actually, the company managed its inventories and its raw material costs quite effectively.

The verticals of electro mechanical projects and engineering products showed EBIT growth of much smaller scale. Net margins at 6.13% was surely a head over the 4.86% on a yoy basis but was a tad lower than NPM 6.82% in the sequential Jun-21 quarter.

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Nykaa IPO - Subscription Day 2

Nykaa IPO - Subscription Day 2
by 5paisa Research Team 29/10/2021

The Rs.5,352 crore IPO of FSN E-Commerce Ventures (Nykaa), consisting of a fresh issue of Rs.630 crore and an offer for sale or OFS of Rs.4,722 crore, was already oversubscribed on Day-1 itself. As per the combined bid details put out by the BSE at the end of Day-2, FSN E-Commerce Ventures (Nykaa) IPO was subscribed 4.82X overall, with the demand coming almost equally from retail segment, HNI segment and QIB segment. The issue closes on 01st November.

As of close of 29th October, out of the 264.85 lakh shares on offer in the IPO, FSN E-Commerce Ventures (Nykaa) saw bids for 1,277.49 lakh shares. This implies an overall subscription of 4.82X. The granular break-up of subscriptions were equally distributed among the three major participants viz. retail, QIB and HNIs. QIB bids and NII bids typically gather momentum only on the last day of the IPO.

FSN E-Commerce Ventures (Nykaa) IPO Subscription Day-2
 

Category

Subscription Status

Qualified Institutional Buyers (QIB)

4.72 Times

Non Institutional Investors (NII)

4.17 Times

Retail Individuals

6.32 Times

Employees

1.18 Times

Overall

4.82 times

 

QIB Portion

The QIB portion of the IPO was subscribed 4.72 times at the end of Day-2. On 27 October, FSN E-Commerce Ventures (Nykaa) did an anchor placement of 212.96 lakh shares at the upper end of the price band of Rs.1,125 to 174 anchor investors raising Rs.2,396 crore.

The list of QIB investors including a number of marquee names like Blackrock, Fidelity, Government of Singapore, ADIA, MAS, T Rowe Price, Aberdeen, Goldman Sachs, SBI MF, HDFC MF, ICICI Pru MF, Kotak MF, Tata MF; among others.

The QIB portion (net of anchor allocation as explained above) has a quota of 143.53 lakh shares of which it has got bids for 677.28 lakh shares, implying a subscription ratio of a healthy 4.72X for QIBs at the end of Day-2. QIB bids typically get bunched on the last day, but anchor response at 40 times does indicate good institutional interest.

HNI / NII Portion

The HNI portion got subscribed 4.17X (getting applications for 297.03 lakh shares against the quota of 71.30 lakh shares). This is a solid response on Day-2 considering that this segment normally sees response bunched on the last day. That is because, bulk of the funded applications and corporate applications, come in on the last day, so the actual picture should only get better. 

Retail Individuals

The retail portion was subscribed a robust 6.32X at the end of Day-2, showing strong retail appetite. However, it must be noted that retail allocation is just 10% in this IPO. For retail investors; out of the 47.53 lakh shares on offer, valid bids were received for 300.22 lakh shares, which included bids for 235.23 lakh shares at the cut-off price. The IPO is priced in the band of (Rs.1,085-Rs1,125) and will close for subscription on 01st November 2021.

Also Read:-

Nykaa IPO - Subscription Day 1

Nykaa IPO - 7 Things to know before applying for IPO

Upcoming IPOs in 2021

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Fino Payments Bank IPO - Subscription Day 1

Fino Payments Bank IPO - Subscription Day 1
by 5paisa Research Team 29/10/2021

The Rs.1,200 crore IPO of Fino Payments Bank, consisting of a fresh issue of Rs.300 crore and an offer for sale (OFS) of Rs.900 crore, saw a tepid response on Day-1. As per the combined bid details put out by the BSE, Fino Payments Bank IPO was subscribed 0.51X overall, with bulk of the demand coming from the retail segment which saw a robust oversubscription. The issue closes on 02nd November.

As of close of 29th October, out of the 114.65 lakh shares on offer in the IPO, Fino Payments Bank saw bids for 58.14 lakh shares. This implies an overall subscription of 0.51X. The granular break-up of subscriptions were tilted in favour of retail investors with HNIs and QIBs hardly participating on the first day of the IPO. QIB bids and NII bids typically come in only on the last day of the IPO.
 

Fino Payments Bank IPO Subscription Day-1

 

Category

Subscription Status

Qualified Institutional Buyers (QIB)

0.00 Times

Non Institutional Investors (NII)

0.05 Times

Retail Individuals

2.73 Times

Employees

0.25 Times

Overall

0.51 times

 

QIB Portion

The QIB portion of the IPO saw nil subscription at the end of Day-1. On 28 October, Fino Payments Bank did an anchor placement of 93,37,641 lakh shares at the upper end of the price band of Rs.577 to 29 anchor investors raising Rs.539 crore.

The list of QIB investors including a number of marquee names like Fidelity, HSBC Global, Pinebridge, Birla Mutual, Tata MF, SBI Life, Invesco, BNP Paribas and Societe Generale; among others.

The QIB portion (net of anchor allocation as explained above) has a quota of 62.25 lakh shares of which it has got bids for Nil shares on Day-1 of the IPO. QIB bids typically get bunched on the last day, but anchor response has been robust and that is good news.

HNI / NII Portion

The HNI portion got subscribed 0.05X (getting applications for 1.44 lakh shares against the quota of 31.13 lakh shares). This is a relatively tepid response on Day-1 and this segment normally sees response on the last day. That is because, bulk of the funded applications and corporate applications, come in on the last day, so the actual picture should only get better. 

Retail Individuals

The retail portion was subscribed a robust 2.73X at the end of Day-1, showing strong retail appetite. Retail allocation for this IPO is 35% of the offer size. For retail investors; out of the 20.75 lakh shares on offer, valid bids were received for 56.56 lakh shares, which included bids for 45.10 lakh shares at the cut-off price. The IPO is priced in the band of (Rs.560 – Rs577) and will close for subscription on 02nd November 2021.

Also Read :-

Fino Payments Bank IPO - Information Note

Fino Payments Bank IPO - 7 Things to Know

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SJS Enterprises Ltd IPO - Information Note

SJS Enterprises Ltd IPO - Information Note
by 5paisa Research Team 30/10/2021

SJS Enterprises Ltd, a leading player in the decorative aesthetics industry, proposes to come out with an IPO of Rs.800 crore. The issue opens on 01-November and closes for subscription on 03-November. The entire issue will be an offer for sale so there will be no fresh funds coming into the company nor any dilution of equity. It will only provide an exit to the existing early investors and provide a basis for stock market valuation.

SJS Enterprises Ltd offers a plethora of such aesthetic products including 2D and 3D appliques and dials, 3D lux badges, domes, overlays, aluminium badges, in-mould labels, lens mask assembly, chrome plate printing etc. SJS Enterprises Ltd essentially caters to the automotive and the consumer durables segment.
 

Key terms of the IPO issue of SJS Enterprises Ltd
 

Key IPO Details

Particulars

Key IPO Dates

Particulars

Nature of issue

Book Building

Issue Opens on

01-Nov-2021

Face value of share

Rs.10 per share

Issue Closes on

03-Nov-2021

IPO Price Band

Rs.531 - Rs.542

Basis of Allotment date

10-Nov-2021

Market Lot

27 shares

Refund Initiation date

11-Nov-2021

Retail Investment limit

13 Lots (351 shares)

Credit to Demat

12-Nov-2021

Retail limit - Value

Rs.190,242

IPO Listing date

15-Nov-2021

Fresh Issue Size

Nil

Pre issue promoter stake

98.86%

Offer for Sale Size

Rs.800 crore

Post issue promoters

50.37%

Total IPO Size

Rs.800 crore

Indicative valuation

Rs.1,650 crore

Listing on

BSE, NSE

HNI Quota

35%

QIB Quota

50%

Retail Quota

10%

 

Data Source: IPO Filings
 

Here are some of the key merits of the SJS Enterprises Ltd business model


1) SJS is one of the leading players in the decorative aesthetics segment

2) It straddles the complete value chain from design to delivery

3) It supplies over 11.5 crore parts to over 170 customers across 20 countries

4) The ten largest customers of SJS have been loyal leaders for over 15 years

5) ROCE of 31.6% makes it a very niche value play in the segment

6) OEMs account for 66%-68% of total revenues, making it a stable business model

7) Free cash flow to EBITDA of 57% and Free cash flow to PAT of 96% makes it a very healthy profitability and cash flow scenario for SJS Enterprises Ltd
 

Check - SJS Enterprises IPO - 7 Things to know
 

How is the SJS Enterprises Ltd IPO structured?


The SJS Enterprise IPO will be a total offer for sale where the promoters will be diluting their stake through the issue. Here is a gist of the IPO offer of the company.

A) The OFS component will comprise of the issue of 147.60 shares and at the peak price band of Rs.542, the OFS value would be Rs.800 crore which will also be the size of the total IPO issue.

B) Out of the total OFS of Rs.800 crore, Evergraph Holdings Pte Ltd, the promoter company will sell shares worth Rs.710 crore while one of the promoters, Mr. K A Joseph will shares worth Rs.90 crore.

The promoter holdings will get substantially diluted post the OFS and the public will end up with 49.63% shares with promoters holding 50.37% shares post the issue.
 

Key Financial parameters of SJS Enterprises Ltd
 

Financial Parameters

Fiscal 2020-21

Fiscal 2019-20

Fiscal 2018-19

Sales Revenues

Rs.251.62 cr

Rs.216.17 cr

Rs.237.25 cr

Net Profit

Rs.47.77 cr

Rs.41.29 cr

Rs.37.60 cr

Net Worth

Rs.315.22 cr

Rs.279.65 cr

Rs.238.56 cr

Net Profit Margins

18.98%

19.10%

15.85%

ROCE

31.63%

26.44%

28.28%


Data Source: Company RHP

The net margins and the ROCE hint at solid financials and have also been consistently growing over time. The EBITDA margins above 31% hint at profitable operations and that is evident from the strong customer franchise built by the company.

Also, being an OFS, there will be no dilution of equity, which shows the ability of the company to self-fund growth from internal resources.
 

Investment Perspective for SJS Enterprises Ltd
 

Being a total OFS, the issue of SJS Enterprises Ltd will not result in dilution of equity and hence shareholders earnings will be protected. Here are some merits.

a) In the kind of decorative aesthetics business that SJS is into, long term relations matter a lot. That is where the OEM links of SJS can be value accretive.

b) The design to delivery approach means that SJS Enterprises Ltd straddles the entire value chain. That gives them greater control over inputs and output as well as costs.

c) It counts among its OEM customers marque global names and domestic names like Suzuki, ,M&M, John Deere, Volkswagen, Honda, Bajaj Auto, Ashok Leyland, TVS Motors, Marelli, Whirlpool, Panasonic, Samsung, Eureka Forbes, Godrej and the list goes on.

d) Share of exports have been growing from 9.8% to 16.1% over the last 2 years. That is a good approach to de-risk the model from the Indian consumer market.

If one looks at the valuations in P/E terms, the stock is quoting at 35X historic earnings and around 31X forward earnings assuming CAGR growth rates sustaining. That is a reasonable level to pick up a stock with leadership position in its niche.

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IRCTC Asked to Share 50% Convenience Fee

IRCTC Allowed to Retain 100% of Convenience Fee
by 5paisa Research Team 30/10/2021

In a high level meeting between the top officials of the IRCTC and the Railway Board, the Ministry of Railways decided to withdraw the decision to ask IRCTC to share 50% of the convenience fee charged from customers on online ticketing. The new rule was to be effective from 01-November but now stands withdrawn.

The secretary of DIPAM, the disinvestment body, Mr. Tuhin Kant Pandey clarified that the decision to ask IRCTC to share 50% of the convenience fee on railway ticketing with the government had been scrapped. This is a major source of revenues for IRCTC and is charged over and above the price of the ticket to finance the online interface.

It was a volatile trading day for IRCTC on the bourses. The stock opened weak on Friday after it had closed at Rs.913.75 on Thursday. However, once the implications of the 50% sharing became evident the stock dropped all the way to Rs.650 on the BSE, a fall of nearly 29% from previous close. However, after the clarification hinted by the government, the stock bounced back and closed at Rs.845.65, still with a loss of 7.45%.

In terms of market cap loss, IRCTC has already lost 33% falling from Rs.100,000 crore in early October to Rs.67,000 crore currently. Even after this sharp fall, the stock quotes at a P/E ratio of 49X and a price to book value of 9.97. Here is why the 50% share could have been significant hit on the numbers of IRCTC.

Sharing of convenience fee is nothing new. The convenience fee was shared 20:80 in FY15 and in that year convenience fees had generated Rs.253 crore. In the next year, the sharing arrangement was moved to 50:50 and the total convenience fee related revenues was Rs.562 crore. Between 2017 and 2019, the convenience fee practice was discontinued.

In the year 2019-20, IRCTC re-introduced the convenience fee to compensate for some of the losses caused by COVID lockdowns. However, at that point, the Railways waived off its share and IRCTC was allowed to retain the full amount of Rs.352 crore in 2019-20 and Rs.299 crore in 2020-21. In the first 5 months of FY22, IRCTC has already earned Rs.224 crore as convenience fee.

The moral of the story is that the 50:50 sharing would have been a huge revenue and profit dent for IRCTC. That has now been set to rest with the Railways confirming that there will be no convenience fee sharing for now.

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