After a record-breaking 31 initial share sales in the first half of this fiscal year, the IPO pipeline remains robust, with 28 firms aiming to raise Rs 38,000 crore in the second half and an additional 41 awaiting approval from Sebi to launch initial public offerings worth Rs 44,000 crore, according to a report. Despite the number of IPOs more than doubling to 31 in the first half, with a total mop-up of Rs 35,456 crore, fundraising through initial public offerings fell by 26% to Rs 26,300 crore compared to the previous year, as reported by Prime Database. Of these 69 companies in the IPO pipeline, three new-age technology firms plan to collectively raise Rs 12,000 crore.
OYO is reported to be the leader in the pack, seeking to raise over Rs 8,300 crore, followed by Go Digit Insurance. In contrast, the first half saw only one tech IPO by Yatra, which raised Rs 775 crore in late September. Notable IPOs in the previous fiscal year included Paytm, Zomato, and Nykaa. Pranav Haldea, Managing Director of Prime Database, noted that despite current volatility in the secondary market, the next half is expected to see several IPOs launched before a potential pause due to general elections.
According to leading brokerage Angel One, major upcoming IPOs include OYO, Tata Technologies, JNK India, Dom Industries, Apeejay Surrendra Park Hotels, Epack Durables, BLS E-Services, India Shelter Finance Corporation, Cello World, RK Swamy, Flair Writing Industries, Go Digit Insurance, and Credo Brands Marketing, among others. The proposed Tata Technologies IPO will be the first IPO from the Tata Group in 19 years, with Tata Motors expected to sell over 811 lakh shares in the offer for sale. The IPO will comprise a 100% offer for sale. Tata Technologies is a key player in automotive engineering and R&D services, serving 35 original equipment manufacturers and 12 new energy companies.
Originally, OYO Rooms planned to raise Rs 8,430 crore, with Rs 7,000 crore in fresh issue and Rs 1,430 crore in offer for sale. However, it is expected to revise its valuation and issue size. According to Haldea, overall public equity fundraising increased by 69% to Rs 73,747 crore in the first half of FY24, up from Rs 43,694 crore in the first half of FY23. The largest issue in the first half was Mankind Pharma’s Rs 4,326 crore IPO, followed by JSW Infrastructure (Rs 2,800 crore) and RR Kabel (Rs 1,964 crore). The smallest IPO came from Plaza Wires, raising just Rs 67 crore, with an average size of Rs 848 crore. Out of the 31 IPOs in the first half, 21 were launched in August and September.
The Goods and Services Tax (GST) Council has made significant decisions in its 52nd meeting. One key decision is the delegation of the taxation of Extra Neutral Alcohol (ENA), used in the production of potable alcohol, to the states. Union Finance Minister Nirmala Sitharaman announced this decision and explained that despite the GST Council’s authority to impose charges on ENA, it has chosen to relinquish the right to tax distilled alcohol used for human consumption to the states. GST will still apply to ENA intended for industrial use.
Reduction in Millet Flour Levy Rates
In addition to the ENA decision, the GST Council has also lowered the levy rates on millet flour. Sitharaman clarified that if millet flour is unpackaged and contains a minimum of 70 percent millet, it will now be subject to a zero percent tax rate. However, if the millet flour is packaged and labeled, it will incur a five percent tax rate.
Lower GST on Molasses
Furthermore, the GST Council has reduced the GST tax rate on molasses from 28 percent to 5 percent. This change is expected to benefit sugarcane farmers and reduce the cost of cattle feed.
Age Limit for Council Members Extended
Sitharaman also highlighted a change in the age limit for council members. The tenure for the president and members of the council can now extend up to a maximum age of 70 years, an increase from the previous limit of 67 years for the president and 65 years for members.
The 52nd meeting of the GST Council, chaired by Nirmala Sitharaman, took place at Sushma Swaraj Bhawan in New Delhi and was attended by the union finance minister, union minister of state for finance, chief ministers of Goa and Meghalaya, as well as finance ministers of states and union territories (with legislature).
Delhi Finance Minister Atishi expressed deep concern over the issuance of tax evasion notices totaling ₹1.5 lakh crore to online gaming companies, warning that these actions could potentially cripple the industry. She has announced her intention to appeal for the withdrawal of these notices during the 52nd meeting of the Goods and Services Tax (GST) Council.
Industry’s Valuation vs. Tax Notices
Atishi highlighted a stark contrast between the valuation of online gaming companies at ₹23,000 crore and the staggering ₹1.5 lakh crore in tax evasion notices issued to companies within the online gaming sector. She emphasized the urgent need to seek the withdrawal of these notices to protect an industry that is already grappling with the adverse effects of a 28 percent tax rate.
Impact on Investor Confidence
The Delhi Finance Minister pointed out that an “unstable and erratic tax environment” could deter foreign investors from entering the online gaming industry. This, in turn, could have a detrimental impact on the broader startup ecosystem in the country.
Background on GST Amendments
During its 51st meeting held on August 2, the GST Council introduced amendments to the GST laws. These changes clarified that the 28 percent tax rate applies to casinos, horse racing, and online gaming, with taxation being based on the full value of bets placed rather than the gross gaming revenue. These amendments became operational on October 1 following approval by Parliament during the monsoon session.
Show-Cause Notices and Tax Demands
Despite the recent implementation of these amendments, numerous online real-money gaming companies have received show-cause notices for alleged tax evasion. For instance, Play Games 24X7, the operator of RummyCircle and My11Circle, reportedly received notices for ₹21,000 crore, while fantasy e-sports firm Dream11 was served with a notice for ₹28,000 crore.
Cumulative Tax Demands
Authorities are said to be preparing to issue tax demands totaling as much as ₹1.5 trillion from online gaming companies for alleged underpayments spanning several years. It is worth noting that these notices appear to pertain to the period preceding the recent GST law amendments, with tax officials applying a 28 percent tax to the full value of bets placed during that time.
Ashish Kacholia, a prominent figure in the Indian investment landscape, has demonstrated his prowess with an exceptional feat. Within just three months, he reportedly earned a staggering ₹25 crore through a small-cap stock investment. Kacholia, whose estimated net worth exceeds ₹2000 crore, continues to make headlines for his remarkable investment strategies.
Balancing the Portfolio with Balu Forge
Kacholia’s latest triumph is attributed to his investment in Balu Forge, a small-cap company. He acquired a 2.16 percent stake, consisting of 21,65,500 shares, in the company at ₹115.45 per share. Currently, the share price has surged to ₹230.45, effectively multiplying his investment by approximately 700 percent in just three months. The total value of his holdings in Balu Forge has now reached ₹49.9 crore, as reported by ET Now. Balu Forge, founded in 1990 in Belgaum, specializes in manufacturing crankshafts for vehicles.
A Win with Bharat Bijlee
In addition to his success with Balu Forge, Kacholia has achieved another significant win in the stock market. His investment in Bharat Bijlee, which he made over three-and-a-half years ago at ₹498 per share, is now trading at ₹3850 per share, reflecting an impressive 700 percent return on investment. This remarkable journey of growth in Bharat Bijlee’s stock price demonstrates Kacholia’s acumen as an investor.
Continued Success
Kacholia’s investment prowess is further underscored by the fact that Bharat Bijlee has seen a 60 percent return to its shareholders over the past year, with its stock price rising from ₹2400 to ₹3850 per share. Over the past two years, the stock has also witnessed substantial growth, climbing from ₹1335 to ₹3850 per share. Ashish Kacholia’s investment journey continues to serve as an inspiration in the world of finance and stock markets.
In the world of precious metals, ‘K’ or carat is the term used to measure the purity of gold. The highest purity is represented by 24K gold, which is considered pure gold with a staggering 99.9 percent purity, making it almost in a liquid form. It is free from traces of other metals. Conversely, 22K gold contains slight traces of metals like copper and zinc.
Gold Price Update
On Sunday, gold prices experienced a modest increase of ₹25. According to Goodreturns, the price of 22K gold and 24K gold currently stands at ₹5,275 per gram and ₹5,754 per gram, respectively.
Factors Influencing Gold Prices
The price of gold in India is influenced by a myriad of factors, including currency exchange rates, global demand, interest rates, and government policies. A weakening of the Indian rupee against the US dollar can make gold more expensive for Indian consumers. International factors, such as global economic conditions and the strength of the US dollar against other currencies, also play a pivotal role in determining gold prices. Furthermore, the demand for gold within India has a direct impact on its prices; if demand is sluggish, prices tend to decrease.
City-Specific Gold Prices
Gold prices in various Indian cities are contingent on several factors, including local demand, state taxes, octroi charges, interest rates, bullion associations, and transportation costs.
Silver Price Update
Silver prices also witnessed a minor increase, rising by ₹1.50 on Sunday. As reported by Goodreturns, the current price of one gram of silver is ₹72.10. In major cities like Delhi, Mumbai, and Kolkata, the price of 10 grams of silver stands at ₹721. Conversely, in Bengaluru and Chennai, the prices are ₹688 per 10 grams and ₹750 per 10 grams, respectively.
The Reserve Bank of India (RBI) has brought the curtains down on the exchange/deposit window for ₹2,000 currency notes. Previously extended until October 7, 2023, the central bank, as of now, has not announced any further extensions.
End of Exchange Period
From October 8, 2023, banks across India will cease to accept ₹2,000 banknotes for credit to accounts or exchange into other denominations. This marks a significant shift in the policy regarding these notes.
RBI’s Regional Offices for Redemption
However, there’s still a ray of hope for those holding ₹2,000 notes. These banknotes can still be presented at the 19 Regional Offices of the RBI, which have Issue Departments (RBI Issue offices). Here, they can be credited to bank accounts in India or exchanged, as indicated in the Press Release.
Legal Tender Status Maintained
It’s important to note that ₹2,000 banknotes will continue to retain their legal tender status, even though they won’t be accepted by regular banks. This means that they can still be used for transactions where they are accepted.
A Brief History of ₹2,000 Notes
These notes were introduced as part of the demonetization drive by the Narendra Modi government. However, their printing was discontinued in 2018-19, once banknotes in other denominations became widely available.
Closing the Chapter
As the deadline has passed, banks are now tasked with ensuring that any ₹2,000 banknotes collected by their branches until October 7, 2023, are deposited at currency chests by October 13, 2023.
The total value of ₹2,000 banknotes in circulation stood at ₹3.56 lakh crore as of May 19, 2023, the date on which RBI decided to withdraw them. This decision effectively closes the chapter on these notes in the Indian currency landscape.
Reliance Retail Ventures Ltd, a subsidiary of Reliance Industries Ltd (RIL), has attracted a substantial investment of INR 4,966.80 Crores from the Abu Dhabi Investment Authority (ADIA). This investment secures ADIA a 0.59% equity stake in the retail and digital commerce subsidiary.
Impressive Valuation
The capital infusion elevates the pre-money valuation of Reliance Retail Ventures Ltd to INR 8.28 Lakh Crores. This valuation places the company among the top four enterprises in India in terms of equity value, demonstrating its robust financial position and market significance.
Reliance Retail’s Funding Streak
Reliance Retail has been actively pursuing funding opportunities in recent months, marking a significant capital influx. Prior to ADIA’s investment, Reliance Retail had already secured INR 8,278 Crores from the Qatar Investment Authority (QIA) and INR 2,069 Crores from KKR, further bolstering its financial resources.
This strategic funding spree underscores Reliance Retail’s commitment to expanding its presence and offerings in the rapidly evolving retail and digital commerce landscape. The investment from ADIA not only strengthens its financial position but also solidifies its standing as a major player in India’s corporate landscape.
In response to the recent surge in show cause notices issued to online gaming startups by tax authorities, the central government has provided clarification to the states regarding the 28% Goods and Services Tax (GST) applied to these platforms. The government asserts that this GST rate is not being imposed retrospectively on online gaming companies.
Consistent Taxation on Online Betting
Revenue Secretary Sanjay Malhotra emphasized that online betting has consistently been subject to a 28% GST rate. Therefore, the tax notices served to online gaming platforms should not be viewed as having a retrospective nature.
Concerns Raised by States
Chhattisgarh Minister TS Singh Deo highlighted that during the GST Council meeting, several states expressed concerns about the demands for dues from certain online gaming platforms, which in some cases exceeded their turnover.
Background on GST Notices
This development follows a recent wave of GST notices sent to online gaming companies, with tax authorities seeking dues totaling over INR 50,000 Crores.
The clarification from the Centre aims to address any ambiguity surrounding the GST rate on online betting and underscores the government’s stance that this tax has always applied consistently.
Valiant Laboratories made a robust market debut, with its shares listing at a premium of 15.82% over the IPO price. On the NSE, the stock opened at Rs 162.15, while on the BSE, it started trading at Rs 161, surpassing the issue price of Rs 140. This strong debut provided investors with a substantial return, with each share gaining Rs 22.15, reflecting nearly a 16% increase.
Positive IPO Response
The IPO of Valiant Laboratories received significant attention from investors, being subscribed 29.76 times, indicating a favorable response. However, investors are advised to approach the investment cautiously, considering various associated risks.
Recommendation to Investors
Shivani Nyati, Head of Wealth at Swastika Investmart, suggests that while the Valiant Laboratories IPO had a positive listing and investor response, it’s crucial for investors to evaluate potential risks. These include the company’s single-product focus, dependence on a limited number of suppliers and customers, and competition within the industry. Nyati recommends that investors consider booking profits and exiting their positions. For those intending to hold for the long term, it’s advised to maintain a stop loss at Rs 150.
IPO Details
The Valiant Laboratories IPO was open for public subscription from September 27, 2023, to October 3, 2023. The price band for the public issue was set at Rs 133-140 per equity share with a face value of Rs 10 each. It comprised a fresh issue of 10,890,000 equity shares, raising Rs 152.46 crore. The minimum lot size for the IPO was 105 shares, requiring retail investors to invest Rs 14,700. The subscription statistics were as follows: Qualified Institutional Buyers (QIBs) category – 20.83 times, non-institutional investors – 73.64 times, and Retail Individual Investors (RIIs) quota – 16.06 times.
About Valiant Laboratories
Valiant Laboratories specializes in manufacturing Active Pharmaceutical Ingredients (APIs) and Bulk Drugs, with a primary focus on producing Paracetamol in various grades and sizes according to customer specifications. The company has a track record of consistent revenue growth, achieving a Compound Annual Growth Rate (CAGR) of 35.3% during FY21-23.
The Reserve Bank of India (RBI) has reaffirmed its projection for the Indian crude oil basket price to stay at $85 per barrel in the second half of the current financial year, despite substantial global production cuts announced by OPEC, Saudi Arabia, and Russia through the end of the year. In its Monetary Policy Report for October, the RBI cited economic uncertainty due to geopolitical tensions and discrepancies between global petroleum product prices and crude prices as reasons for this decision.
Upside Risks to Global Crude Prices
While the RBI maintains its Indian crude oil basket projection, it acknowledges potential upside risks to global crude prices. These risks include an escalation of geopolitical hostilities, further supply cuts by OPEC, and strong demand. If crude oil prices rise by 10% above the baseline, the RBI predicts a 30 basis point (bps) increase in domestic inflation and a 15 bps weakening in growth.
OPEC’s Role in Future Prices
The market’s attention will be focused on OPEC’s upcoming decision regarding extending output cuts beyond December, with the meeting scheduled for November 26. OPEC has expressed its commitment to closely monitoring market conditions.
Factors Affecting Crude Prices
The report also highlights factors that could pull down crude oil prices, such as increased supply from non-OPEC countries, de-escalation of geopolitical tensions, and reduced demand due to aggressive monetary policy measures by central banks. If crude oil prices fall by 10% relative to the baseline, and these changes fully pass through to domestic product prices, the RBI anticipates a 30 bps reduction in inflation and a 15 bps boost to growth.
Recent Price Trends
Crude oil prices experienced fluctuations in the first half of the financial year 2024, with a decline in April followed by a recent increase due to production cuts by Saudi Arabia and Russia. However, the prices have moderated to around $85/bbl. Crude inventory data in the US, one of the major crude consumers, continues to influence price dynamics.
RBI’s Policy Stance
The RBI has chosen to keep its policy repo rate unchanged at 6.50% during its latest meeting. RBI Governor Shaktikanta Das emphasized the uncertain global scenario and the importance of not making hasty decisions in response to fluctuating crude prices.
In summary, while the RBI maintains its Indian crude oil basket projection at $85/bbl, it remains vigilant regarding potential global factors that could impact crude prices, acknowledging the need for flexibility in monetary policy in an uncertain environment.
