Blogs, insights, guides and videos on India's unlisted market — all in one place.
<p>Amid escalating India-China tensions and rising anti-Chinese sentiment, the IPL's decision to retain VIVO, a Chinese mobile manufacturer, as its title sponsor has sparked intense debate. This decision underscores a complex interplay of business interests and national sentiments, particularly in the backdrop of recent governmental actions against Chinese entities.</p> <p>Despite social media's push against Chinese products and the Indian Government's decisive steps like banning TikTok and sidelining Huawei from BSNL's 4G tender, IPL's governing council opted to continue its association with VIVO. This move raises questions about the balance between economic interests and national sentiments.</p> <p><strong>Financial Dynamics</strong></p> <p>The financial stakes in this partnership are significant. In 2018, a landmark deal was struck with Star Sports for broadcasting rights and VIVO for title sponsorship, amounting to approximately ₹16,000 Crores and ₹2,200 Crores respectively over five years (2018-2022). This translates to an annual income of about ₹3,700 Crores for BCCI and IPL, equating to roughly ₹460 Crores per team. After BCCI's 20% cut, each IPL team nets around ₹370 Crores solely from these two sponsors.</p> <p><strong>UnlistedZone Perspective</strong></p> <p>The timing of this decision is critical. With just one and a half months before IPL 2020, finding a replacement for VIVO, willing to invest a comparable amount, is a formidable challenge, especially in the current COVID-19 impacted business landscape. For shareholders of unlisted entities like Chennai Super Kings, VIVO's sponsorship is a relief, cushioning potential revenue losses and stabilizing market valuations.</p> <p>For VIVO, this sponsorship represents a strategic opportunity to recapture its market share, which has waned amid negative public perception. Thus, this decision, while contentious, is a pragmatic move for IPL stakeholders, balancing economic viability with prevailing public sentiments.</p>
As per the news sourced from Paytm blogs, Varun Sridhar has joined as Paytm Money’s new CEO. He will manage and develop Paytm’s broking, Mutual funds, NPS, and Gold services business. Before joining Paytm, Varun was previously the part of top retail banks in India and abroad. He has worked 7 years with BNP Paribas, where he led the acquisition and integration of Sharekhan and <!--more-->BNP Paribas. After that, he has also worked as CEO in Finshell India, an OPPO Group company. The Finshell platform offers UPI payments, mutual funds, personal loans, channel finance, insurance, and free credit reports. The past experience of Varun in similar businesses will help Paytm Money achieves its mission to empower millions of Indians with wealth management products. Paytm’s Money is headquartered in Bengaluru and has a team of 300 employees. The company claims to have 60 Lakh users on its platform, buying a direct mutual fund and investing in NPS. The Paytm Money has already received the broking license from SEBI and they are expecting to hit the market with equity services next year. They have also set aside to invest Rs.250 Crores in the equity business to grow it. However, the competition is very tough in the broking industry with discount brokers such as Zerodha, 5Paisa, Uptox, etc are already running businesses in very thin margins. Let us see how this business unfolds for Paytm.
Reliance Industries yesterday has given the earning detail for Q1FY21 to the exchanges. The consolidated revenue has decreased by 42% in the first quarter of FY21 as compared to the same period last year. The PAT has gone up from ~10K Crores in Q1FY20 to ~13K Crores in Q1FY21, due to the addition of exceptional gain of ~5K Crores by selling the Petro Retail Marketing business to Reliance BP Mobility Limited (RMBL). Finally, BP has acquired a 49% equity stake in RBML.<!--more--> At present, Reliance Industries is doing business in many verticals, however, in the unlisted market, we are keen to track the performance of Reliance Retail, the most talked and in-demand unlisted stock. So, let us do that. <strong>Reliance Retail </strong>The EBITDA margins of the Reliance Retail has gone down to 1083 Crores in Q1FY21 as compared to 2060 Crores in Q1FY20. The sharp fall in EBITDA is mainly due to the Covid-19 situation which forced Reliance Retail to completely shut down 50% stores and 29% partially. The EBITDA margins also fell from 6% to 3.80% particularly impacted by drop from profitable categories such as Fashion & Lifestyle. Reliance Retail gets its revenue from the following business; 1. Consumer Electronics. 2. Fashion & Lifestyle. 3. Grocery. 4. Connectivity. 5. Petro <strong>Revenue Contribution (in Crores)</strong> <div class="table-overflow-init"> <table width="100"> <tbody> <tr> <td width="137">Retail business</td> <td width="137">1QFY20</td> <td width="92">1Q FY21</td> <td width="92">% Growth YoY</td> <td width="108">% contribution</td> <td width="94">Footfall drop due to lockdown</td> </tr> <tr> <td width="137">Consumer Electronics</td> <td width="137">10618</td> <td width="92">3243</td> <td width="92">-69%</td> <td>10%</td> <td>-65%</td> </tr> <tr> <td width="137">Fashion & Lifestyle</td> <td width="137">3221</td> <td width="92">939</td> <td width="92">-71%</td> <td>3%</td> <td>-90%</td> </tr> <tr> <td width="137">Grocery</td> <td width="137">7633</td> <td width="92">8027</td> <td width="92">5%</td> <td>25%</td> <td>-45%</td> </tr> <tr> <td width="137">Connectivity</td> <td width="137">12997</td> <td width="92">16,939</td> <td width="92">30%</td> <td>54%</td> <td>NA</td> </tr> <tr> <td width="137">Petro Retail</td> <td width="137">3747</td> <td width="92">2485</td> <td width="92">-34%</td> <td>8%</td> <td>NA</td> </tr> <tr> <td>Total</td> <td>38216</td> <td>31633</td> <td></td> <td></td> <td></td> </tr> </tbody> </table> </div> From the above table, the major impact in revenue seen due to consumer electronics and the F&L segment, which obviously has low demand during the lockdown, and the same is expected to pick up once the Govt. eases out lockdown conditions. The grocery segment was the essential item during a lockdown, saw 5% revenue growth, despite a 45% fall in footfall. The connectivity segment saw a sharp 30% growth due to JIO's momentum. <strong>Highlights of the Q1FY21</strong> 1. Reliance Retail has Opened 69 new stores and SIS sections; >250 stores could not be commissioned due to the prevailing situation. 2. Reliance Retail going more digital and launched JioMart. Reliance Retail and WhatsApp have entered into a commercial partnership agreement to further accelerate Reliance Retail’s Digital Commerce business on the JioMart platform using WhatsApp and to support small businesses on WhatsApp. 3.Partnerships with kiranas/merchants, vendors and farmer ecosystem to be accelerated. <a href="https://unlistedzone.com/storage/knowledge-logo/Reliance-Retail-Q1FY21-performance.pdf">Reliance Retail Q1FY21 Presentation</a>
Moody's yesterday has downgraded Hero-FinCorp local currency and foreign currency rating from "Baa3" to "Ba1". They have also revised the rating to a negative outlook. Let us check the meaning of this rating downgrade. <strong>Moody's Rating Definitions:</strong> <!--more--> <table width="100"> <tbody> <tr> <td rowspan="10" width="161">Investment Grade</td> <td width="124">Aaaa</td> </tr> <tr> <td>Aa1</td> </tr> <tr> <td>Aa2</td> </tr> <tr> <td>Aa3</td> </tr> <tr> <td>A1</td> </tr> <tr> <td>A2</td> </tr> <tr> <td>A3</td> </tr> <tr> <td>Baa1</td> </tr> <tr> <td>Baa2</td> </tr> <tr> <td>Baa3</td> </tr> <tr> <td rowspan="11" width="161">Non-Investment grade</td> <td>Ba1</td> </tr> <tr> <td>Ba2</td> </tr> <tr> <td>Ba3</td> </tr> <tr> <td>B1</td> </tr> <tr> <td>B2</td> </tr> <tr> <td>B3</td> </tr> <tr> <td>Caa1</td> </tr> <tr> <td>Caa2</td> </tr> <tr> <td>Caa3</td> </tr> <tr> <td>Ca</td> </tr> <tr> <td>C</td> </tr> </tbody> </table> 1. Baa means they are considered as medium-grade. 2. Ba means subject to substantial credit risk. So, we can conclude this from the above ratings that as of now Hero-FinCorp is under "substantial credit risk" <strong>Why rating downgrade has happened?</strong> Moody's feels that HeroFinCorp's unseasoned loan book and rapid growth in the past few years may pose risk to asset quality due to economic disruption posed by COVID-19 outbreak. <strong>UnlistedZone view</strong> In the near term, the effect on asset quality will not be easily seen on the balance sheet as RBI has given a 6M moratorium, under which even if the borrowers do not pay debt obligation on time, they will still not be counted as NPA. And we are hoping the economy will revive in one year's time as the economy is slowly opening up and vaccine hope are around the corner. However, despite problems in the NBFC from the last 2-3 years, Hero-FinCorp has able to pay all its obligation on time. The strong parentage of Hero Group will offset all the weaknesses, as they can easily able to raise money from banks in case of such a crisis.
<p>HDB Financial, the HDFC Group Company, is the leading NBFC in India. The HDB Financial is doing business in two operating segments, i.e. Lending business and BPO services. <br /><br /><strong>Revenue Streams</strong> <br /><br />1. The lending business includes providing finance to retail customers for a variety of purposes like purchase of commercial equipment and commercial vehicles, personal purposes, enterprise loans, etc.</p> <!--more--> <p>Revenue from lending business includes <br /><br />(i) interest income and processing fees net of loan origination costs.<br /><br />(ii) collection-related charges like cheque bouncing charges, late payment charges, and foreclosure charges. <br /><br />(iii) insurance commission. <br /><br />2. BPO services comprise of sales support services, back office, operations, processing support, running collection call centers, and collecting overdue amounts from borrowers for HDFC group companies. <br /><br /><strong>Q1 Numbers:</strong> <br /><br />On July 23, it has informed the National Stock Exchange regarding its financial results for Q.E June-20. HDB Financials has shown revenue growth of 6% YoY in the first quarter of June-20 as compared to the same period last year. However, QoQ, there is a fall in revenue of 4.2%. The fall is mainly on sales of services. The interest income, the core business income has seen no impact. The interest income has gone up from 1951 Crores in June-19 to 2153 Crores in June-20. The expense has increased from 2187 Crores year in the first quarter to 2531 Crores this year. Due to this, the net profit after tax has gone down to 111 Crores from 210 Crores last year.<br /><br /><strong>Why has Expense gone up?</strong> <br /><br />If you check the financials of the company, there is an item called “Impairment on financial assets”. The value of this item has gone up from 337 Crores to 686 Crores, resulted in a decrease in profit in the first quarter as compared to the same period last year. This figure indicates that the market value of the financial investment done by the company has gone down. These days in the new accounting system the company needs to show a decrease in the value of the financial asset in the P&L under expense. This helps investors to know the impact of market forces on the assets of the company. The balance sheet is not available with UnlistedZone to know the exact financial asset whose value has gone down. <br /><br /><strong>UnlistedZone View:</strong> <br /><br />The PAT numbers are looking bad because of impairment. However, HDB Financials is doing business quite well. The Company is duly servicing its debt obligations, maintaining a healthy capital adequacy ratio, and has adequate capital and financial resources to run its business. They are not facing any issue in raising money for lending as well, which is otherwise becoming difficult for low-grade NBFCs. <br /><br /><a href="https://unlistedzone.com/storage/knowledge-logo/HDB-Q1-Result.pdf">Results Link</a></p>
Good news for the shareholders of Fresenius Kabi Oncology. Finally, after a wait of 1.5 years, NCLT has passed an order to give an exit route to all the minority shareholders. The history and offered price are explained below. 1. Fresenius Kabi Oncology in the year 2018 has filed a case in NCLT for capital reduction.<!--more--> They have proposed to reduce the number of shares from 17,02,47,857 equity shares of INR 1 (Indian rupee one) to 16,52,32,882 equity shares of INR 1 (Indian rupee one) each by canceling and extinguishing in the aggregate, approximately 2.95% (two point nine five percent) of the total issued, subscribed and paid-up share capital of the Company, consisting of 50,14,975. 2. As per the annual report 2018-19, total shares held by promoters were 97.05% and minority shareholders were 2.95%. 3. So, the company has given exit to all the minority shareholders. 4. The company has decided to pay Rs. 58.40 per share in lieu of their shares being extinguished in accordance with the NCLT order. The minority shareholder should immediately contact the company and surrender their shares. <strong>For Resident Shareholders:</strong> The company will pay the amount after deducting 7.5% TDS to the eligible shareholders. <strong>For Non- Resident Shareholders:</strong> The company will pay the amount after deducting 20% TDS to the eligible shareholders. For more detail please follow the below link. <a href="https://unlistedzone.com/storage/knowledge-logo/FKOL_Notice-Capital-Reduction-1.pdf">Notice Link</a>
The Extraordinary General Meeting (EGM) of the members of Suryoday Small Finance Bank Limited is scheduled to be held on Monday, July 27, 2020, at 3.30 p.m.through Video Conferencing ("VC").<!--more--> <strong>The following business activities will be discussed in the EGM</strong>. 1. To approve the Initial Public Offer of Equity Shares of the Bank. 2. To approve an increase in the authorized share capital of the Bank. 3. To approve alteration of the Capital Clause of Memorandum of Association of the Bank. 4. To approve the amendment of the Suryoday ESOP Scheme-2019. 5. To approve the re-appointment of Mr. Ramachandran Rajaraman (DIN 01953653) as an Independent Director of the Bank. The most important business activity as far as the unlisted market is concerned is the announcement of the IPO. <strong>Mandatory condition of IPO</strong> In terms of the Guidelines for Licensing of Small Finance Banks in the Private Sector dated November 27, 2014, the Bank is required to list its equity shares on the stock exchanges within three years from attaining a net worth of ₹500 crores i.e. before November 30, 2020, or such other date as may be approved by the Reserve Bank of India. The IPO would be a mix of Fresh shares and OFS. <a href="https://karisma.kfintech.com/files/SMFL_NOTICE_OF_EGM_27.7.2020.pdf">Link of Notice</a>
As per the Paytm recent blog, the Paytm payment bank arm has shown profitability once again in the FY19-20. In FY19-20, Paytm payment bank has shown a profit of ~30 Crores as compared to ~20 Crores last year. The profitability has come on the back of acquisitions of users in smaller cities. Paytm payment bank this year has clocked a revenue of ~Rs.2100 Crores.<!--more--> Some amazing stats from the payment bank in FY19-20. 1. Paytm has facilitated 486 Crores transactions from its platform. 2. Done a total of 4.6 Lakh Crores of transactions. This is approximately 2% of India's GDP. 3. Total CASA base increased to 5.8 Crores. 4. The total deposit doubled to 1000 Crores. Paytm bank has recently launched a facility for DBT (Direct benefit transfer), the government subsidy scheme to transfer funds directly to the bank account of needy people. So, all the users who are having Paytm Payment bank saving account now will able to get government subsidy directly in their Paytm account. This will boost the Paytm presence in rural India since, during COVID-19, lot of migrant workers are getting income under the MANREGA scheme. <strong>UnlistedZone View:</strong> Paytm is really doing good in the payment bank segment from the last 2 years and is expected to reduce the overall losses this year, though we don't have the consolidated numbers available with us to give the exact amount of reduction in loss. With back to back profitability in payment bank arm, we can say Paytm is poised for a big leap in India's digital payment segment. The recent acquisition of the Raheja QBE General Insurance business will boost its revenue from the Insurance business in the coming years. To read more about the deal please click here https://unlistedzone.com/paytm-is-acquiring-general-insurance-business-from-raheja-qbe/
<strong>IPO News</strong> On 13.07.2020 Barbeque Nation got approval from SEBI for IPO. Now they have to bring an IPO within one year from this approval date. <strong>Barbeque Nation</strong> Barbeque Nation owns and operates one of India's leading casual dining restaurant chains according to the Technopak Report. The first Barbeque Nation Restaurant was launched in 2005 by Sayaji Hotels, one of their promoters.<!--more--> From the inception, they have steadily grown their owned and operated Barbeque Nation Restaurant network from a single restaurant in Fiscal 2007 to 147th outlet in India and 154th internationally as in 2020. <strong>Valuations</strong> In 2018, when Rakesh Jhunjhunwala invested 90 cr in the company at that time it was valued around 2300-2400 cr. As per the balance sheet of 2018-19, they have ~2.80 cr shares. So, if we take a valuation of 2300 cr, then per share price comes out to be 821-857. Moreover, as per yesterday news published in Mint, “The IPO comprises a fresh issue of shares worth Rs 275 crore and an offer-for-sale of up to 98,22,947 equity shares, according to the draft papers filed with the Securities and Exchange Board of India (SEBI).” If we remove the fresh issue part of 275 cr from the lower end of 1000 cr, then the value per share would be 720 per share. And at the upper end of 1200 cr, then value per share would be 943. <strong>UnlistedZone View</strong> As Covid-19 has made the situation bad especially for the hotel and restaurant sector, the IPO will not come at least in the next 6 months. They will probably time the IPO when the hotel and restaurant sector starts functioning. The IPO price would be in the range of 800-900. To know more about Barbeque Nation, please visit: https://unlistedzone.com/shares/buy-sell-barbeque-nation-unlisted-shares-price-today/
Utkarsh Micro Finance Ltd is the promoting institution for 'Utkarsh Small Finance Bank'. Utkarsh Micro Finance Ltd has started its operations way back in September 2009 to provide financial and non-financial services in its area of operations to the unbanked population who have the skill but are in need of capital.<!--more--> The Micro Finance business was converted into a Small Finance Bank which started his journey with its incorporation on April 30, 2016. Today, Utkarsh Micro Finance Bank is the holding company of the Utkarsh Small Finance Bank. As on 31.03.2020, Utkarsh Small Finance Bank has a loan book of 6281 Cr, NIM of 11.59%, and Book value of 13.42. PAT for the year was 186 Cr which was doubled as compared to the previous year. As per the news published in Financial Express, the bank has raised 195 Cr as Tier-II capital. <strong>What are Tier I and II Capital?</strong> As per RBI regulations, every bank has to maintain certain capital in the ratio of risk-weighted assets to handle the obligations of the banks and to prevent banks from going insolvent. That ratio is called as Capital Adequacy Ratio (CAR). Tier-I capital consists of shareholders' equity and retained earnings. It is the primary source of funds for banks. Tier-II - capital is said to be subordinate capitals. CAR = Tier-I or Tier-II Capital/Risk-weighted Assets <strong>Effect on CAR?</strong> This capital raising exercise will increase the CAR by almost 3%. <a href="https://unlistedzone.com/shares/share-price-utkarsh-micro-finance-buy-sell-unlisted-shares/" target="_blank" rel="noopener noreferrer">Click here to know more about the Utkarsh Small Finance Bank</a>.
As per information received from our sources, BVG India, A Bharat Vikas Group Company is proposing an initial public offering of its equity shares of the face value of ₹10 each ("Equity Shares") for cash, through the book-building process, subject to the Securities and Exchange Board of India approval.<!--more--> The Board has at its meeting dated July 04, 2020, approved; the proposed initial public offering, comprising a fresh issue of the Equity Shares by the Company and an offer for sale of Equity Shares. <strong> BVG India</strong> The journey of BVG India was started in the year 1993 by HR Gaikwad as a non-profit Bharat Vikas Pratishthan to funds of poor & needy students, having been through financial struggles himself. This non-profit group was started to help rural youth to get jobs and livelihood. However, in 1997, the non-profit BVG (Bharat Vikas Group) turned into a housekeeping company with 8 people & 1 client. Today, it is India’s Largest Integrated services company with 75000+ employees, serving 800+ sites for 750+ customers in 70 cities across 20 states across India. <strong> What is BVG Group?</strong> 1. India's Largest Integrated Service Company in India. 2. Asia's Largest Police Support Service. 3. India's largest Emergency Ambulance Service. 4. Pioneers of Mechanized housekeeping in India. 5. 100+ Train cleaned and maintained every day. Today they have big clients like Bajaj, Mahindra, Ashok Leyland, Hyundai, Volkswagen, Fiat, in automobile companies, and ONGC, ITC, Hindustan lever, Accenture and Indian Railways in the public-private sector. To know more about BVG Group, please visit: https://unlistedzone.com/shares/bvg-india-limited-unlisted-share/
As per information from our sources, Suryoday Small Finance Bank, that the board is evaluating an initial public offering of its equity shares (the “Equity Shares”) for cash, subject to approval by the Shareholders and market conditions, regulatory, corporate, and other approvals.<!--more--> The IPO would be a mix of fresh issue of its Equity Shares (the “Fresh Issue”) and an offer for sale of Equity Shares by certain existing shareholders of the Bank. So once the shareholders approve the IPO plan, the Suryoday Small Finance Bank will file for DRHP with SEBI. <strong>Suryoday Small Finance Bank:</strong> Started in the year 2008-09, Suryoday Small Finance Bank provides Microfinance loans, Loans against the property, MSME loans, Commercial vehicle loans, and SME lending. As of 31.03.2020, the bank has advances of 3531 Cr with G.NPA of 2.81%. <a href="https://unlistedzone.com/shares/buy-sell-suryoday-small-micro-finance-bank-limited-unlisted-shares-share-price/" target="_blank" rel="noopener noreferrer">To know more about the Suryoday SFB, please visit this page.</a> <strong>Investors:</strong> Suryoday Small Finance Bank is backed by top-notch investors. 1. International Finance Corporation, 2. Gaja Capital Fund. 3. Evolvence India Fund II. 4. Americorp Ventures Limited etc. 5. DWM (International) Mauritius Limited <strong>Financial Performance and Comparison with listed Peers:</strong> To know how it has performed in the last 5 years and how it currently fares up with listed peers in terms of valuation, then please go through the following links: https://unlistedzone.com/suryoday-small-finance-fy20-results-update-and-analysis-30-05-2020/ https://unlistedzone.com/comparison-of-unlisted-and-listed-small-finance-bank-11-04-2020/
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