business this week - arc-fs.com this week (12 april 2010).pdf · relianceinfra 8.5% hul 4.1% dlf...

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Strategies for your Success

BSE Sensex

10,974

10,970

10,898

10,927

10,997

05 Apr 06 Apr 07 Apr 08 Apr 09 Apr

Dow Jones

21,537

21,929 21,86722,209

05 Apr 07 Apr 08 Apr 09 Apr

Hang Seng

BUSINESS THIS WEEK - India12 April 2010

Stock Markets: The Sensex and Nifty extended their gains for the ninth successive

week. Strong fund buying from FIIs, firm global markets and anticipation of healthy Q4

Apr’10 earnings by companies led the upsurge. The BSE Sensex rose 241 points, or

1.4%, to 17,933 in the week ended 9th Apr’10. On the other hand, NSE Nifty climbed 71

points, or 1.4%, to 5,362 in the same period

FIIs Activity: During the week, FIIs have been net buyers of ~INR 16B, taking the

current year's tally to $5.17B

Foreign Exchange Reserve: The foreign exchange reserves rose by $2B to

$279.10B for the week ended as against $277.04B the previous week

Inflation:Wholesale food inflation continued its upward movement, standing at 17.70%

for the week ended 27 Mar’10, primarily due to rising prices of milk and pulses. The

overall inflation for Feb’10 stood at 9.89%

Crude oil: Crude oil for May’10 delivery declined 47 cents i.e. 0.6% to $84.92 a barrel

on the New York Mercantile Exchange, the lowest settlement since 1 Apr’10

Gold: Gold futures for Jun’10 delivery rose $9 i.e.0.8% to $1,161.90 an ounce on the

Comex in New York.

INR vs. USD 44.50 INR vs. GBP 67.76

INR vs. EUR 59.32 INR vs. JPY 0.48

5-Apr 6-Apr 7-Apr 8-Apr 9-Apr

21.78 21.7721.84

21.55

21.75

BSE Sensex P/E

BSE: 17,933 NSE: 5,362 DJI: 10,997 Nasdaq: 2454 S&P 500: 1,194 HSI: 22209 FTSE: 5,771 Nikkei: 11,204

241 1.4% 71 1.4% 70 0.6% 51 2.1% 16 1.4% 672 3.0% 26 0.5% (40 ) (0.4%)

Currency

Top Gainers Top Losers

Reliance Infra 8.5% HUL 4.1%

DLF 7.4% Hindalco 2.7%

1

17,936

17,941

17,970

17,714

17,933

05 Apr 06 Apr 07 Apr 08 Apr 09 Apr



Mergers, Acquisitions and Joint Ventures

BUSINESS THIS WEEK - India

2

12 April 2010

Healthcare & Lifesciences:

Biocon SA, the wholly owned subsidiary of Bangalore-

based biopharmaceuticals company Biocon Ltd, is

acquiring ~49% stake in Biocon Biopharmaceuticals Pvt.

Ltd. (BBPL) held by CIMAB SA, a Cuban company, for an

undisclosed sum

CIMAB SA was a joint venture partner with Biocon

The JV was engaged in manufacturing products based on

the monoclonal antibodies in their facility in Bangalore

Post this acquisition, BBPL will become a wholly owned

subsidiary of the company

Opto Circuits acquires N S Remedies for $1.5M

Opto Circuits India Ltd, a Bangalore-based healthcare

equipment and interventional products maker, has acquired

Kolkata-based N S Remedies Ltd for $1.5M (~INR 67M

The company has made an all-cash transaction to buy the

firm

This will help the company to enhance the value of the

products offered in the interventional cardiac space and will

also reduce the manufacturing costs, and help access

additional markets

Energy & Power:

Greenko acquires LVS Power

With this move, the firm has bagged the rights to develop 117-

MW gas-fired project in Andhra

This will help to increase the operating capacity of Greenko to

158 MW and the total secured capacity of the company from

470 MW to 587MW

Consumer Goods & Retail:

Tata Tea approves non-binding MoU for a JV with

Pepsi

Tata Tea board has approved a non-binding MoU for a JV with

Pepsi to explore business opportunities in the non-carbonated

space

JV will be dealing in new product developments, and will not

see any asset transfer from the two participating companies

Godrej Consumer Products Ltd (GCPL) acquired an

Indonesian firm PT Megasari Makmur Group, for an

undisclosed sum

The acquisition will provide significant synergies and create

value for shareholders

Megasari is an active player in household insecticides and

aircare business in Asia with a strong market share in India, Sri

Lanka, Nepal, Bangladesh and Indonesia

Real Estate & Infrastructure:

GVK Power and Infrastructure plans to acquire majority

stake in Mumbai and Bangalore international airports

The company currently holds about 37% in MIAL and

around 29% in BIAL


Strategies for your SuccessBUSINESS THIS WEEK - India

2

12 April 2010

Telecom, Media & Technology:

Mphasis acquires Fortify Infrastructure Services

The deal is a combination of upfront payment of $15M by

Mphasis and earnouts

Acquisition will give the company access to an experienced

management team and a talent pool of highly experienced

professionals, besides new customers

Fortify has operations in India as well, and has a command

center in Pune, Maharastra

GoAhead Software Inc. acquired Avantellis Middleware, a

group firm of Emerson Network Power India, for an

undisclosed sum

The acquisition of Avantellis will help the company to create

an unmatched level of capability at GoAhead and enables to

continue tradition of world class expertise in delivering

standards-based software solutions

Emerson Network is a diversified global manufacturing and

technology company in Mumbai

Reliance Big Entertainment Ltd. (RBEL), part of Reliance

ADA group, is picking 50% stake owned by Goldman

Sachs in Codemasters, a leading British developer and

publisher of video games, for an undisclosed sum

Post deal, RBEL would become a co-promoter of

Codemasters alongside existing investor, European venture

capital firm Balderton Capital


ValueFirst Messaging, a Gurgaon-based enterprise

mobility and communication services company

acquired a majority stake in social media firm

Tagg.in, for an undisclosed sum

ValueFirst currently has a mobile-based transaction platform

called CellPay, which the company got from the acquisition of

VAS company CellNext. Following this acquisition, it plans to

integrate CellPay into Tagg.in

This is the 2nd acquisition by ValueFirst in 12 days

Industrials:

Reliance Industries enters into $1.7B JV with Atlas Energy

As per the deal, Reliance will be acquiring 40% interest in

Atlas Energy’s core Marcellus Shale (in southern

Pennsylvania) acreage position

– The company will pay ~$340M in cash and an additional

$1.36B under a carry agreement for 75% of Atlas’ capital

costs for a period of seven-and-a-half year development

program

The transaction is expected to close by the end of Apr’10

JV will help Reliance’s to incerase resources base and provide

with an entirely new platform of exploring and production

business of Marcellus Shale




3

12 April 2010

Industrials:

Coal India plans to equity stake in US miner Peabody

Energy Corp

Peabody Energy Corp is one of five companies in which Coal

India is considering to buy equity stakes or for mining joint

ventures

The company is also planning to launch an IPO later this year




Capital Raising (PE, VC, Right Issue)

4

12 April 2010

Agriculture:

Summit Partners invests $30M in Krishidhan Seeds (KSL)

Summit Partners made its first investment in India in the agro

sector with an infusion of $30M into Krishidhan Seeds a

biotech firm

KSL plans to utilize the fund for research &

development, technology and product-related acquisitions

Healthcare & Lifesciences:

Orbimed, the world’s largest healthcare-dedicated

investment firm invested an undisclosed sum in bio-

pharmaceutical company Bharat Serums and Vaccines

Limited (BSV)

Orbimed, the world’s largest healthcare-dedicated investment

firm has invested an undisclosed sum in bio-pharmaceutical

company Bharat Serums and Vaccines Limited (BSV)

Fund made its first Indian investment in Ecron Acunova last

year

Real Estate & Infrastructure:

SEW Infra gets INR 1.52B from NYLIM Jacob Balas India

Fund III LLC

SEW received this infusion of capital from the Mauritius based

PE to strengthen its balance sheet in order to bid for larger

projects

These funds will also be used to fund capex and working

capital requirements

Energy & Power:

Orbis Power Venture acquires 17.31% stake in DPSC

Orbis Power bought up 0.7M shares on the open market at an

average price of INR 710

The stake was acquired in combination with SREI

Infrastructure Finance and Indian Power Corporation Ltd.

Temasek Holdings to invest $200M in GMR Energy

As per the agreement, GMR will issue preferential shares to

the PE player that will be convertible into equity

The funding is being done through its wholly owned subsidiary

Claymore Investments based out Mauritius

GEL plans utilize the fund to enhance its installed power

generation capacity to over 6,500MW over the next 3-4

years, from 808MW now

IFC to invest $1.25M in Husk Power (HPS)

IFC will take final decision about the investment plan in its

board meeting scheduled on 10 May’10

HPS is engaged in producing clean energy from rice husks

using biomass gasification technology, and provides electricity

to rural Indians in a financially sustainable and scalable

manner




4

12 April 2010


Sequoia hiked its stake to 1.5% in General Atlantic-backed

Infotech Enterprises for INR 125M

Sequoia increases its stake from 1% to 1.5% in General Atlantic-

backed Infotech Enterprises by purchasing shares in the secondary

market worth INR 125M

Sequoia plans to focus on value buying with about INR 4B cash

reserves which is growing about 10% every quarter

Blackstone to Invest INR 2.25B in Jagran Media Network for an

undisclosed minority stake

PE firm, Blackstone has indicated that it will be investing INR 2.25B

in Jagran Media Network (JMN) for an undisclosed minority stake

Promoters, Gupta family, who own 55.33% stake through individual

shareholding will turn over their stake to JMN, a holding

company, and Blackstone will acquire a minority stake in it

Sequoia Leads $5M Series A Round In Druva Software

Druva Software, a provider of continuous data protection and

disaster recovery products, has raised $5M in a series A round of

funding led by Sequoia Capital India

The company plans to utilize the fund in expanding operations in the

global markets

Industrials:

CX Partners acquired 8% stake in Monnet Ispat for INR

1.5B

CX partners, acquired 8% stake from a group of FIIs at

about INR 390 a share

UBS, Goldman Sachs, JM Financial Consultants, DSP

Merrill Lynch, Kotak Mahindra Capital and SBI Capital

Markets will lead the sale of 220M IDRs

Clearwater Capital hiked its stake in Diamond Cables by

2.2% for ~INR 10M

Clearwater Capital hiked its stake in Diamond Cables by

purchasing 2.2% stake for ~INR 10M through the

secondary market which takes its total holding to 13.77%

The latest share purchase by Clearwater is at INR 160 a

share, more than twice its average cost of purchase till

date

It had originally invested at a price of INR 95 in FY’07 and

thereafter at INR 151 through separate convertible

instruments which, after the bonus issue, works out to cost

of acquisition of INR 62 a share

Reliance Venture Asset Mgt invests an undisclosed sum

in Tessolve in a Series C round of funding

Tessolve, a semiconductor test and product engineering

company, The financial details of the deal are undisclosed

but the funding was achieved in conjunction with JAFCO

Asia, Qualcomm Ventures and Applied Ventures

This round of funding will enable the company to scale up

operations and expand capabilities in India




4

Banking, Financial Services & Insurance:

Matrix Partners leads INR 1.18B Investment in Basix Group Firm

Matrix Partners India, a Mumbai-based venture capital firm, is

investing INR 1B in Bhartiya Samruddhi Finance Ltd (BSFL), the

Hyderabad-based flagship company of microfinance major BASIX

Group

Hivos Triodos Fonds and Lok Capital Llc are the two other investors

participating in this round with another INR 180M

The funds will enable the firm to scale up operations and enhance

operational effectiveness

IFC picks 9.5% in Chola DBS for INR 1B

IFC is picking up a 9.5% stake in Cholamandalam DBS Finance

(CDFL), for INR1B

IFC will subscribe to 10.8M fresh shares to be issued by the NBFC at

a price of INR 92 per share on a preferential basis

The sale of equity will allow CDFL to improve its liquidity position and

strengthen its capital adequacy ratio, while simultaneously fulfilling the

requirement of maintaining a minimum public holding of 25%

ESAF Microfinance raises INR 30M from Oikocredit International

ESAF Microfinance and Investments Pvt Ltd (EMFIL), a Kerala-based

non banking financial company (NBFC), has raised INR 30M from

Oikocredit International of Netherlands, which has picked up 10%

stake in the firm

The investment is made through Oikocredit’s fully owned Indian

subsidiary Manaveeya Holdings and Investments

EMFIL hopes to increase its reach to the number of households five-

fold to 1M by 2014 from an existing customer base of 200K

12 April 2010



PE / VC Exits

7

Banking, Financial Services & Insurance:

SUUTI to exit Stock Holding Corp

The Specified Undertaking of UTI (SUUTI) has made its intent known to exit SHC. It hopes to net INR 3B from the deal

Rakesh Jhunjhunwala exits Mid-day Multimedia at par

Jhunjhunwala invested in the media firm in late 2004 and has been holding on to his 2.25M shares all this while

He sold all of his 4.26% stake (from five and half year old investment) in Mumbai-based media house Mid-day Multimedia almost at

par

12 April 2010



8

IPOs Listing

Year IPOs*

2010 YTD 22

2009 17

2008 37

2007 103

2006 75

2005 39

Date of Filing Company Name Industry

08 Apr’10 C Mahendra Exports Limited Consumer Goods & Retail

05 Apr’10 ICOMM Tele Limited Real Estate & Infrastructure

05 Apr’10 JP Infrastructure Limited Real Estate & Infrastructure

05 Apr’10 Ravi Kumar Distilleries Limited Consumer Goods & Retail

05 Apr’10 You Broadband and Cable India Limited Telecom

Company Issue Price

(INR)

Issue Size (INR) Listing Price (INR)

Persistent Systems 290-310 40M 310

Pradip Overseas 100-110 10.6M 110

Shree Ganesh Jewellery House 260-270 14.3M 260

DRHP Filed

IPOs Listed

12 April 2010

*On the basis of Listing,



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business this week - arc-fs.com this week (12 april 2010).pdf · relianceinfra 8.5% hul 4.1% dlf...

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