Tag: irfc ipo

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Adani Group, AAI Sign Concession Agreement for 3 Airports – Top Indian Market News

Adani Group signs concession agreement with AAI for Jaipur, Guwahati, TVM airports

Adani Group has signed a concession agreement with the Airports Authority of India (AAI) for operating and maintaining Jaipur, Guwahati, and Thiruvananthapuram airports. The concession period is 50 years from the commercial operation date. The group will now get six months to take over the three airports. Adani Group had emerged as the highest bidder for six AAI airports, namely, Lucknow, Mangalore, Ahmedabad, Jaipur, Guwahati, and Thiruvananthapuram in February 2019.

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Alembic Pharma Q3 Results: Net profit rises 25% YoY to Rs 292 crore

Alembic Pharmaceuticals Ltd reported a 24.92% YoY increase in consolidated net profit to Rs 292.57 crore for the quarter ended December (Q3). The drug firm’s consolidated revenue rose 9% YoY to Rs 1314 crore during the same period. The company’s performance in Q3 was led by strong growth in its India formulation business, which grew 14% YoY to Rs 418 crore. 

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Petrol price touches record high of Rs 85 in Delhi; diesel crosses Rs 75 mark

The price of petrol in Delhi rose by 25 paise on Tuesday, reaching an all-time high of Rs 85.20 per litre. The diesel price has jumped to Rs 75.38 per litre in the national capital. The rates have been hiked for the second consecutive day after remaining unchanged for three days. State-owned fuel retailers– Indian Oil Corporation Ltd (IOC), Bharat Petroleum Corporation Ltd (BPCL), and Hindustan Petroleum Corporation Ltd (HPCL)– resumed daily price revision on January 6 after nearly a month-long hiatus. Since then, fuel rates have gone up by Rs 1.49 a litre on petrol and Rs 1.51 in the case of diesel.

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CSB Bank Q3 Results: Net profit rises 88% YoY to Rs 53 crore

Kerala-based CSB Bank reported an 88% YoY increase in net profit to Rs 53 crore for the quarter ended December (Q3). The bank’s net interest income (NII) grew by 61.8% YoY during the same period. [NII is the difference between the interest income a bank earns from its lending activities and the interest it pays to depositors] CSB Bank’s overall provisions stood at Rs 111 crore in Q3. The bank has also announced a voluntary retirement scheme (VRS) for its select employees.

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Bank of Maharashtra Q3 Results: Net profit rises 14% YoY to Rs 154 crore

Bank of Maharashtra reported a 14% YoY increase in net profit to Rs 154 crore for the quarter ended December (Q3). The Pune-based lender’s total income rose 3.42% YoY to Rs 3,577 crore. On the asset quality front, the bank recorded improvement with gross non-performing assets (NPAs) falling from 16.77% in Q3 of the previous financial year to 7.69% in Q3 FY21. The bank’s provisions fell by more than 80% YoY to Rs 498 crore in Q3.

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IRFC IPO gets fully subscribed on Day 2

The initial public offering (IPO) of Indian Railway Finance Corporation (IRFC) was fully subscribed on the second day of bidding. The IPO has received bids for 152.6 crore equity shares, against an offer size of over 124.75 crore equity shares. The portion set aside for retail investors witnessed a subscription of 2.33 times and that of employees 27.40 times. The reserved portion of non-institutional investors was subscribed 24.3% and that of qualified institutional buyers 0.16%.

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CEAT Q3 Results: Net profit rises 150% YoY to Rs 132 crore

Ceat Ltd reported a 150% YoY increase in consolidated net profit to Rs 132 crore for the quarter ended December (Q3). The tyre manufacturer’s revenue surged 26% YoY to Rs 2,221 crore during the same period. The company’s strong performance in Q3 was backed by an increase in overall vehicle production. Sales in the after-market segment had also made a strong comeback.

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Tata Communications Q3 Results: Net profit jumps 5-fold to Rs 309 crore

Tata Communications’s net profit jumped 5 times (or 425%) YoY to Rs 309.41 crore for the quarter ended December (Q3). The company’s revenue stood at Rs 4,222.83 crore during the same period. The growth in profits at an operational level was largely due to a fall in network and transmission costs. The firm had also introduced cost-cutting measures in the current financial year. 

Hatsun Agro Q3 Results: Net profit rises 141% YoY to Rs 67 crore

Hatsun Agro Products Ltd reported a 141.2% YoY increase in net profit to Rs 67.3 crore for the quarter ended December (Q3). It had posted a net profit of Rs 28 crore in the corresponding period in FY20. The company’s revenue rose 4.1% YoY to Rs 1,394.6 crore in Q3 FY21. Chennai-based Hatsun Agro is a leading private sector dairy company.

Brigade Group launches 11-acre residential project at Hyderabad

Brigade Group announced the expansion of its footprint in Hyderabad by launching a residential project named ‘Brigade Citadel’. The 11-acre residential project is situated in Hyderabad’s Moti Nagar area. Brigade Citadel comprises of over 1,300 luxurious two and three-bedroom homes which are competitively priced, starting at Rs 75 lakh and Rs 99 lakh, respectively. 

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Man Industries secures order worth Rs 250 crore

Pipe manufacturer Man Industries (India) Ltd announced that it has secured orders worth Rs 250 crore. The orders will be executed over the next 5 months. Man Industries is the flagship company of Man Group and is one of the largest players in longitudinal submerged arc welding (LSAW) pipes, spirally welded pipes, and coating systems.

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Indian Railway Finance Corporation Limited IPO: All You Need to Know

2020 was unmemorable for a lot of reasons but Initial Public offers (IPO) is not one of them. Out of the 16 IPO launched in 2020, 12 IPO gave investors the much-desired listing gain. You can read about the top 5 IPOs of 2020 here. 

The Indian Railway Finance Corporation (IRFC) has decided to take the public route. They will be the first company coming with its IPO in 2021. The IPO will hit the market on 18th January 2021. Let’s dig deeper and understand what it is all about.

About the Company

The Indian Railway Finance Corporation (IRFC) was incorporated in 1986. It is fully owned by the Government of India. The main role of IRFC is to act as a borrowing arm of Indian Railways. It is responsible for raising funds for the Ministry of Railways (MoR). The primary business of IRFC is to finance the acquisition of rolling stock assets. These stock assets consist of wagons, trucks, electric multiple units, containers, cranes and more.

India has a huge railway network with approximately 13,452 trains every day. In fact, India holds the largest rail network in Asia as it transports 22.70 million passengers per day (FY18). IRFC has financed almost 40% of the total expenditures carried out by Indian Railways in 2019-20. 

About the IPO

https://twitter.com/SecyDIPAM/status/1349218668316540928

The IPO of this state-run company will open on 18th January and will close on 20th January. The total issue size of the IPO is Rs 4,600-crore. A total of 178.2 crore equity shares will be offered by IRFC as their move to go public. It comprises a fresh issue of up to 118.8 crore shares and an offer for sale of up to 59.4 crore equity shares. The price band of the IPO is Rs 25-Rs 26 per equity share.

Anchor investors have been allocated 60% of the total portion reserved for qualified institutional buyers (QIBs). As the price of the shares is low, you are required to buy at least 575 equity shares as one lot. Further bids can be made in multiples of 575 shares. That means an investor who is looking to invest in this IPO has to at least pay Rs 14,950 (Rs 26 x 575). The maximum a single investor can invest is Rs 1,94,350. But since the IPO will be oversubscribed anyway, there is no point in applying for more than one lot.

Mostly, there are two reasons why IRFC has decided to take the public route. Firstly, to increase the company’s equity capital base and make it more robust. This will help them to meet business future growth requirements. Secondly, to meet general corporate purposes. 

Financial Overview

30 September 202031 March 202031 March 201931 March 2018
Total Assets2,91,986.582,75,504.122,06,438.291,61,451.04
Total Income7,384.0013,421.0911,133.599,268.38
Profit after Tax1868.843192.092139.932,001.46
(Values in Rs Crore)

As you can see from the table, the revenues and profits have increased consistently for the last three years. IRFC recorded a 20% increase in revenues in FY20 as compared to FY19. Their profits rose by a stunning 50% from Rs 2139.93 crore to Rs 3192.09 crore in just one year. This tells us that the company has done well in recent times. Till the first half of 2020-21, we can see that the company has also accumulated revenue worth Rs 7,384 crore. With this trend, they will easily surpass their numbers of the previous year.

The biggest strength of IRFC is its pivotal role in the growth of Indian Railways. Most of the Indian population, especially the lower-middle class population, travels through trains. They find travelling through the air very costly. Thus, Indian Railways, which is still very cheap, is their preferred option. Indian Railways will only expand from where they are right now. This expansion will involve a significant amount of financing, thus giving more business prospects to the company.

Risk Factors

  • As a borrowing arm of the Indian Railways, IRFC derives a large part of their revenues from them. This comes by leasing Rolling Stock Assets to the Indian Railways. In 2019, 99.81% of the total operating revenue came from Lease income, interest on loans and pre-commencement lease interest income. If there is any shift from the funding requirement or reduced demand for Rolling Stock Assets will adversely affect the company’s business.
  • Any slowdown in Indian Railways or government initiatives to move away from traditional railway format will affect IRFC’s business.
  • IRFC meets their funding requirements from taxable/tax-free bonds, term loans from banks, internal accruals and lease financing. Their lending projects can be severely impacted if the cost of funds, coming to them, increases.
  • IRFC could witness a rise in their financing cost if there is a downgrade in their credit ratings. A downgrade in India’s debt rating can also decrease the operational efficiency of the company.

IPO Details in a Nutshell

IPO DateJan 18, 2021 – Jan 20, 2021
Issue TypeBook Built Issue IPO
Face ValueRs 10 per equity share
IPO PriceRs 25 to Rs 26 per equity share
Lot Size575 Shares
Offer for Sale(goes to promoters)594,023,000 Equity Shares
Fresh Issue(goes to the company)1,188,046,000 Equity Shares
Issue Size1,782,069,000 Equity Share
Listing AtNSE, BSE

Conclusion

An NBFC is not a reliable bet in our opinion but IRFC’s business model is very safe. IRFC lends to the Indian Railways, which is a government agency. Thus, the risk of non-repayment of loans is very low, if not zero. As the lending margin increases, net interest income(NII) will increase, and it is more profitable for IRFC. Still, do consider the risk associated with this company as explained above and then come to your own conclusion. IRFC had filed draft papers for its IPO last January. You can find it here. What are your opinions on this IPO? Will you be applying for it? Let us know in the comments section below!

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Infosys Reports 16% YoY Rise In Net Profit – Top Indian Market News

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Infosys Q3 Results: Net profit jumps 16.6% YoY to Rs 5,197 crore

Infosys Ltd reported a 16.6% year-on-year (YoY) increase in consolidated net profit at Rs 5,197 crore for the quarter ended December (Q3). The IT major had posted a net profit of Rs 4,457 crore in the same period last year. The company’s revenue rose by 12.27% YoY to Rs 25,927 crore. Infosys had secured large digital-transformation deals from companies such as Rolls-Royce, El Paso Water, and Daimler in Q3.

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Govt to sell 5% stake in SAIL through OFS

The Central Government has decided to sell up to 20.65 crore shares or 5% of the total equity of Steel Authority of India Limited (SAIL) through an Offer for Sale (OFS). The floor price of the OFS has been set at Rs 64 per share. The OFS for non-retail investors opens on Thursday (Jan 14). It will start for retail investors on Friday (Jan 15). The government currently holds a 75% stake in SAIL.

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Wipro Q3 Results: Net profit rises 21% YoY to Rs 2,968 crore

Wipro Ltd reported a 20.85% YoY increase in net profit to Rs 2,968 crore for the quarter ended December (Q3). It had reported a net profit of Rs 2,455.9 crore in the same quarter last year (Q3 FY20). The IT firm’s revenue rose by 1.28% YoY to Rs 15,670 crore during the same period. Wipro has declared an interim dividend of Re 1 per equity share. The record date for the same has been set as January 25.

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IRFC to launch Rs 4,633-crore IPO on January 18

State-owned Indian Railway Finance Corporation (IRFC) announced that it will launch its Rs 4,633-crore initial public offering (IPO) on January 18. The price band of the IPO has been set at Rs 25-26 per share. IRFC is offering up to 178 crore equity shares of the face value of Rs 10 each. The IPO comprises a fresh issue of up to 118.8 crore equity shares and an offer for sale of up to 59.4 crore equity shares by the government. IRFC is the first non-banking financial company (NBFC) in the PSU sector that is going public. 

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Reliance loses crown to HDFC Bank in the NIFTY 50

Reliance Industries Limited (RIL) has lost its position to HDFC Bank in terms of weightage in the NIFTY 50. RIL’s weightage slipped to as low as 9.82% on Monday and stood at 10.08% on Tuesday. This led to the stock losing its top rank to HDFC Bank. On Monday, the private sector bank’s weight in NIFTY 50 surpassed RIL’s for the first time since May to 10.11%.

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Amazon signs deal with Bharti Airtel to launch world’s first mobile-only Prime Video plan

Amazon has partnered with Bharti Airtel to introduce Prime Video Mobile Edition at an introductory price of Rs 89. India has become the first country in the world to obtain this mobile-only Prime Video plan. Airtel customers can get 28-days of Prime Video Mobile Edition through pre-paid recharges starting at an introductory offer of Rs 89. The recharges will be available on the Airtel Thanks app or at recharge points across the country.

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Petrol price touches new high of Rs 84.45 in Delhi, crosses Rs 91 mark in Mumbai

Petrol price on Wednesday touched a new high of Rs 84.45 per litre in Delhi, as state-owned fuel retailers hiked prices after a five-day interval. Petrol and diesel prices were hiked by 25 paise per litre each, according to a price notification from oil marketing companies. In Mumbai, petrol comes for Rs 91.07 a litre and diesel for Rs 81.34. This is the highest ever price of petrol in Delhi, while diesel is at a record high in Mumbai.

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India clears purchase of 83 ‘Tejas’ jets for IAF

The Cabinet Committee on Security (CCS) has approved the procurement of 83 Light Combat Aircraft (LCA) Tejas Mk-1A for the Indian Air Force (IAF). The Rs 48,000 crore deal will be the biggest ever in the indigenous military aviation sector. The aircraft will be manufactured by Hindustan Aeronautics Limited (HAL). About 500 Indian companies, including MSMEs in the design and manufacturing sectors, will be working with HAL in this procurement.

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SEBI bans CNBC TV anchor Hemant Ghai, family members from capital market

The Securities and Exchange Board of India (SEBI) has barred CNBC TV anchor Hemant Ghai, his wife, and his mother from accessing the capital markets for indulging in fraudulent trading activity. The market regulator has alleged that the three individuals pocketed nearly Rs 3 crore between January 2019 and May 2020 by dealing in stocks that were being recommended on the TV show Stock 20:20 on CNBC Awaaz. SEBI stated that Hemant Ghai had the advance information about the recommendation to be made on the show (which was co-hosted by him) and that he directly or indirectly used it to his advantage.

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L&T secures multiple orders in domestic, overseas market

Larsen & Toubro has secured orders for the construction of metallurgical plants and power transmission & distribution projects in the domestic as well as international market. The construction major said that the orders fall under the “significant” category, which ranges between Rs 1,000 crore and Rs 2,500 crore. The company also stated that it has bagged an engineering, procurement, construction, and commissioning (EPCC) contract to construct a 500-kilovolt transmission line in Malaysia.

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Granules India receives USFDA approval for diabetes management drug Metformin

Granules India announced that the US Food & Drug Administration (USFDA) has granted final approval for its Abbreviated New Drug Application (ANDA) for Metformin Hydrochloride Extended-Release Tablets. The tablets are indicated for the management of Type-2 diabetes. According to IQVIA health data, Metformin Hydrochloride ER tablets had sales of approximately $192 million (~Rs 1,404 crore) in the US for the twelve months ending in November 2020.

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