MCX to hit capital market with IPO on 22nd February

The offer would comprise of sale of about 64.27 lakh shares, accounting for a 12.6% stake in the company. While the price band for the IPO is yet to be fixed, sources said that the IPO could raise Rs650-Rs750 crore

New Delhi: Multi Commodity Exchange (MCX), India's largest commodity bourse, will hit the capital market next week with an estimated Rs650-Rs750 crore initial public offer (IPO) on 22nd February, becoming the first ever IPO by an exchange in the country, reports PTI.
    
The bidding for shares in the IPO process would begin on 22nd February and close on 24th February, the company said in its Red Herring Prospectus, the final document for the offer.

While the price band for the IPO is yet to be fixed, sources said that the IPO could raise Rs650-Rs750 crore.

This could also be the first IPO of the calendar year 2012.

The offer would comprise of sale of about 64.27 lakh shares, accounting for a 12.6% stake in the company. This would include 2.5 lakh shares reserved for employees.

Besides the promoter Financial Technologies (India), shares would also be sold by other shareholders like State Bank of India, Corporation Bank, Bank of Baroda, ICICI Lombard General Insurance, GLG Financials Fund and Alexandra Mauritius in the IPO.

The shares would have a face value of Rs10 each, while the premium would be calculated later.

MCX said in its RHP that the IPO has been assigned top-most grading of '5/5' by Crisil, indicating strong fundamentals. The IPO grading is assigned on a five-point scale from 1 to 5, with IPO Grade 5/5 indicating strong fundamentals and IPO Grade 1/5 indicating poor fundamentals.

The company further said that the equity shares are proposed to be listed on the BSE and it has received in-principle approval from the BSE for the listing.

Last week, MCX chairman Venkat Chary had said that the company’s IPO would be game changer in the stock market and would lift the sentiment from the current slump. “This IPO will lift all the boats,” he had said.

The IPO could give the exchange the market value of over Rs5,000 crore.

The promoters—FTIL—currently holds 31.2% stake in MCX, which would come down to about 26% after the IPO.

MCX, the largest commodity bourse in the country, has more than 70% share in an annual estimated turnover Rs177 lakh crore for the entire commodity derivatives market.

Globally, MCX is the fifth largest commodity exchange, while it figures among the top two positions in gold and silver segments.

It would be the first exchange in India to go public, putting the country at par with other markets like the US, UK, Japan, Australia, Singapore and Hong Kong.

MCX had recorded Rs447.5 crore of total income and Rs176.2 crore of net profit in the fiscal year ended 31 March 2011. In the current fiscal, the company has posted net profit of Rs218 crore and total income of Rs474 crore for the nine-month period ended 31 December 2011.

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Tata Motors Q3 net profit soars 41% to Rs 3,406 crore

Higher marketing spends and overall cost pressures resulted in a reduction in the operating margins to 6.7% and an operating profit (EBITDA) of Rs897 crore in the quarter, declining by 26.3% over the corresponding period last year

Tata Motors today reported consolidated revenues (net of excise) of Rs45,260 crore for the quarter ended 31 December 2011, a growth of 44% over Rs31,442 crore in the corresponding quarter of the previous year on the back of growth in volumes, improved product and market mix. The consolidated profit before exceptional items and tax was Rs4,658 crore, a jump of 68.7% over Rs2,760 crore in the corresponding quarter of the previous year.

The consolidated profit before tax (PBT) for the quarter was Rs4,494 crore compared to Rs2,728 crore for the corresponding quarter of the previous year. The consolidated profit (after tax and post minority interest and profit in respect of associate companies) for the quarter was Rs.3,406 crore, as compared to Rs2,424 crore in the corresponding quarter of the previous year, 40.51%.

Tata Motors’ standalone revenues (net of excise) of Rs13,338 crore represented a growth of 18.2% over Rs11,280 crore in the corresponding period last year. Higher marketing spends and overall cost pressures resulted in a reduction in the operating margins to 6.7% and an operating profit (EBITDA) of Rs897 crore in the quarter, declining by 26.3% over Rs1,217 crore in the corresponding period last year.  

The PBT for the quarter was Rs186 crore, as compared to Rs531 crore in the corresponding period last year and the PAT for the quarter was Rs174 crore as compared to Rs410 crore in the corresponding period last year.

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Share prices may struggle with an upward bias: Tuesday Closing Report

Nifty may rise if it crosses the level of 5,430

The market, which opened marginally in the red on weak global cues, saw little movement for most part of the session. However, select buying in late trade helped the indices close higher for the second day in a row.

Today the Nifty moved in a narrow range of 5,378 and 5,428. We had mentioned in our yesterday’s closing report that the index should cross the level of 5,430 to see the uptrend regaining strength. In a major part of today’s session the benchmark tried to move higher after each fall. The index may fall to 5,300 if it doesn’t cross the level of 5,430. The National Stock Exchange (NSE) had a volume of 92.64 crore shares.

The market opened marginally lower, tracking the weak Asian markets in early trade after global ratings agency Moody’s on Monday warned that it would cut the triple-A ratings of France, UK and Austria. At the same time, the agency downgraded the ratings of Italy, Portugal, Spain, Slovakia, Slovenia and Malta. Back home, the Nifty lost nine points to resume trade at 5,381 and the Sensex opened at 17,767, down six points from its previous close.

The indices fell to their intraday lows in initial trade with the Nifty falling to 5,378 and the Sensex slipping to 17,743. But, buying in mid-cap and small-cap stocks soon helped the market gather some momentum to emerge into the positive.

Headline inflation for January coming in at a 26-month low of 6.55% helped the market clock some gains in the pre-noon session. However, lack of any fresh triggers kept the market range-bound almost for the entire trading session.

A pick-up in buying activity in the last half hour enabled the benchmarks touch their intraday highs towards the close of trade. At the highs, the Nifty touched 5,428 and the Sensex rose to 17,890. The market closed marginally below those levels. The Nifty closed at 5,416, 26 points up and the Sensex settled at 17,849, a gain of 76 points.

The advance-decline ratio on the NSE was in favour of the gainers at 1023:768.

The broader indices outperformed the Sensex today as the BSE Mid-cap index surged 1.15% and the BSE Small-cap index gained 0.83%.

Rate sensitive sectors were in demand today. The top sectoral indices were BSE Capital Goods (up 2.30%); BSE Realty (up 2.29%), BSE Auto (up 2.14%); BSE Bankex (up 0.81%) and BSE Consumer Durables (up 0.65%). BSE Healthcare (down 0.57%) and BSE Oil & Gas (down 0.21%) ended as losers in the sectoral space.

Among Sensex stocks, Larsen & Toubro (up 3.87%); Tata Motors (up 3.74%); State Bank of India (up 3.26%); Maruti Suzuki (up 3.24%) and Hindalco Industries (up 3.18%) were the top performers.  On the other hand, Cipla (down 6.28%); Tata Power (down 3.61%); ONGC (down 1.67%); Bharti Airtel (down 1.45%) and Jindal Steel (down 0.88%) were the main losers.

The top five Nifty stocks were Reliance Communications (up 5.69%); Tata Motors (up 5.56%); L&T (up 5.21%); Maruti Suzuki (up 3.67%) and Hindalco Ind (up 3.59%). The main losers on the index were Cipla (down 5.96%); Tata Power (down 3.33%); Siemens (down 1.94%); ONGC (down 1.73%) and Bharti Airtel (down 1.62%).

Markets in Asia closed mixed as fears of further downgrade of key European economies by Moody’s made investors nervous. In another development, the Bank of Japan, in a policy shift, added 10 trillion ($130 billion) to its asset buying and lending scheme. The central bank also said it would target consumer inflation of 1% as its short-term goal.

The Shanghai Composite declined 0.30%; the Jakarta Composite fell by 0.23%; the Seoul Composite lost 0.15% and the Taiwan Weighted slipped 0.36%. On the other hand, the Hang Seng gained 0.15%; the KLSE Composite rose 0.21%; the Nikkei 225 climbed 0.59% and the Straits Times advanced 0.37%. At the time of writing, European markets that opened weak after Moody’s ratings downgrade, were trading mostly higher and the US stock futures were in the green.

Back home, foreign institutional investors were net buyers of shares totalling Rs469.77 crore on Monday, whereas domestic institutional investors were net sellers of equities aggregating Rs597.31 crore.

PSL and its wholly owned foreign subsidiary, PSL FZE, based in Sharjah, UAE, have recently secured orders aggregating over Rs742 crore for the manufacture of pipes and the provision of ancillary coating services from various international and domestic clients. The stock surged 3.12% to close at Rs69.50 on the NSE.

Japanese steelmaker JFE Steel Corporation has increased its stake in India’s JSW Steel to 15%. JFE Steel Corporation in a statement said that it has raised its ownership ratio in JSW Steel to 15% by partly converting its GDRs into common shares. Pursuant to this ownership increase, JSW Steel will become an “equity method affiliate” of JFE Steel from this quarter. JSW Steel gained 2.30% to close at Rs832.95 on the NSE.

Diamond Power Infrastructure plans to spend Rs753 crore to expand its current manufacturing plant to produce conductors and medium voltage cables at Vadodra. The expansion is to be completed over 30 months in three phases beginning April 2013. The stock gained 2.98% to close at Rs131.35 on the NSE.

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