Posts Tagged ‘Infosys Technologies’

CIL sets IPO record; to list on Nov 4

India’s IPO market created history on Thursday with state-owned Coal India share issuer in the becoming the biggest country, beating Reliance Power’s 2008 initial public offering.

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At the time of going to press, the CIL issue was subscribed 15.26 times, collecting Rs 2,36,113.28 crore. The shares will debut on the market on November 4, a day before Muhurat trading that marks Diwali.

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Responding to late rush from retail investors, the company postponed the close of the issue to 9 pm.

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At the upper end of the band, CIL will be the seventh biggest Indian company by market cap, after ONGC, State Bank of India, TCS, Reliance Industries, Infosys Technologies and NTPC, based on Thursday’s closing price. CIL’s Rs 15,474 crore IPO has overtaken Reliance Power’s Rs 11,700 crore issue.

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Buoyant demand from retail and wealthy investors on the final day added to the strong response from institutional buyers. This also signalled success for the government’s upcoming share sales.

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Retail investors, who often take cues from institutions in IPOs, had put in bids for shares 1.44 times or for 28,60,44,375 shares. Retail investors will get a five per cent discount on the final issue price.

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Wealthy individuals had separately bid for 13.89 times the shares available for them.

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Bidding for the mega IPO closed on Wednesday for qualified institutional buyers, including foreign institutional investors, mutual funds and insurance firms. And for the portion reserved for them, the issue was over subscribed by 24.70 times, lead by FIIs.

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The IPO has generated a demand of 493,38,72,050 shares from FIIs. Calculated at the upper end of the price band, this demand is worth Rs 1,20,879.86 crore and at the lower end worth Rs 1,11,012.12 crore. Even at the low end, the demand surpasses the record Rs 1.08 lakh crore pumped in by FIIs into the capital
market.

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India’s largest new issue came amid a flurry of big deals in Asia.

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At the top of its price range, Coal India would be valued at 15.7 times trailing earnings. The issue also got the highest demand for an Indian issue, helped by qualified institutional buyers.

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The demand from QIBs for CIL was at Rs 1,73,398 crore with 100 per cent application amount, compared with Rs 1,88,923 crore with 10 per cent margin for Reliance Power IPO. In case of Reliance Power, the QIB portion was covered 30.68 times.

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“The response to Coal India IPO, from all classes of investors, has surpassed even the most optimistic predictions. It has caught even the biggest optimists by surprise,” SMC Global Securities strategist Jagannadham Thunuguntla said in a note.

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He said the response puts the government on target to achieve its divestment target of Rs 40,000 crore in fiscal 2011 and even exceed it if other issues like the follow-on offering of Power Grid, Steel Authority of India, ONGC, Shipping Corporation of India, Indian Oil Corporation and IPO of Manganese Ore fall in place.

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The government, which has collected Rs 17,500 crore from public issues, including Coal India, may raise its divestment target and get over Rs 58,500 crore, SMC Capital added.

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At the upper end of price range, Coal India issue is worth Rs 15,474 crore and at the lower end it would fetch about Rs 14,211.81 crore.

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The upper band would also give it a market capitalisation of Rs 1.54 lakh crore ($34.7 billion).

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Meanwhile, the broader market recovered from a two-day slump and closed up 1.95 per cent at 20,260.58 points. Now all eyes will be on whether it will be a strong listing on the eve of Diwali.

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Morning News Capsules

Hello Friends, here, we bring you the latest updates from the Indian market and Industry.

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SMC Morning News Capsules

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NEWS CAPSULES

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• Backed by government stimulus measures and a low base effect,  growth in industrial output touched a two-year high in November 2009.

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The index of industrial production (IIP) grew 11.7 per cent, primarily due to growth in manufacturing (12.68 per cent in November as against 2.7 per cent last year),
fuelling a debate on withdrawal of fiscal and monetary stimulus measures.

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•  Maruti Suzuki, India’s largest manufacturer of passenger cars, launched Eeco, a multipurpose vehicle (MPV) in Ahmedabad.

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With Maruti Omni being largely used by the cargo segment, and the Versa failing to create a buzz in the market, the company needed to focus on the passenger side.

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Introduced in three variants at a price range of Rs 2.58-2.89 lakh, Eeco aims at fulfilling this gap.

Currently the company sells 550 Omni each month.

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•  Telecom major, Bharti Airtel, has announced that it has agreed to acquire 70% stake in Bangladesh-based, Warid Telecom.

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Bharti plans to make $300 million fresh investment in the company, thus taking the overall investment to $1 billion.

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The new funding will be for capacity expansion, coverage and innovative products.

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• FMCG major Dabur said it has tied up with a Belgium firm for technical collaboration to reduce carbon emissions in its plants and has invested Rs 5 crore for the purpose.

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The company said it is rolling out a host of initiatives at its various manufacturing facilities spread across India and Nepal to reduce carbon emissions and become more energy efficient.

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• Central electricity distribution firm PowerGrid would sign an agreement with Bangladesh later next month for setting up a transmission link with the neighboring country.

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Punj Lloyd has bagged orders worth Rs 947 crore from Ind-Barath Energy.

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The company informed that it has won an order for partial balance of plant and civil work on a two 350 MW thermal power project by Ind-Barath Energy, Orissa.

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• New Delhi Television (NDTV) has informed BSE that NDTV Worldwide, a NDTV Group company has entered into an agreement with Beximco Group, Bangladesh.

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The company would be providing consultancy to set tip and assist in the business management and operations of a 24-hour news and current affairs channel proposed to be launched in Bangladesh by Beximco Group.

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Infosys Technologies, India’s second-largest software services exporter, has reported a 3.6 per cent year-on-year (Y-o-Y) decline in net profit to Rs 1,582 crore for the third quarter ended December 31, 2009.

Total income, too, saw a decline of close to 1 per cent to Rs 5,741 crore.

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• Two – wheeler giant Bajaj Auto reported a smashing 189.24 per cent increase in its net profit at Rs 475.14 crore for the third quarter ended December 31, 2009.

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The company had a net profit of Rs 164.27 crore in the corresponding quarter a year ago.

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•  IT firm Mastek reported a 24.8 per cent decline in its net profit at Rs 23.54 crore for the quarter ended December 31, 2009.

It had a net profit of Rs 31.33 crore in the same period previous fiscal.

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Indian IT industry on strong footing: Infy

Indian IT industry on strong footing

The Indian IT industry is still on a strong balance and is bound to develop with more investment in research and development and in spite of cutting costs; it has not reduced strategic investment, stated Infosys Technologies Chief Executive and Managing Director S Gopalakrishnan.

Additionally, he said that they invest more in new services, value additions, new solutions and products; therefore if they don”t pay now, they will pay later on.

Hence, although radical innovation is lengthy, it will certainly pay in the future.

Although Indian companies were focusing on process innovations, they should switch over to product innovations, he said, adding Universities should also focus on R&D.

Therefore, Indian companies are also buying companies located in the developed countries which will help them market their products globally and would also help to speed up on growth.

Additionally, he said India was in a better position in terms of economic growth as it was driven by people, unlike in China where it is government driven whereas, another advantage for India was its young population.