CRISIL Equities estimates about Rs40,000 crore will be raised from IPOs in 2010 and the reduction in timeline by 10 days is expected to translate into interest savings of Rs800 crore annually, at an opportunity cost of 10%.
Ratings agency CRISIL said it expects the reduction in the time between initial public offering (IPO) and listing to 12 days from 22 days will lead to interest savings of about Rs800 crore annually for retail and high net worth individual (HNI) investors.
Earlier this month, market regulator Securities and Exchange Board of India (SEBI) cut the time between IPO and listing to 12 days in an aim to make the existing public issue process more efficient.
“SEBI’s move to cut the time frame between IPO closure and listing will benefit investors participating in the primary market since it will lower the opportunity cost for funds invested in the IPO. Further, the move will reduce the risk of market volatility in the intermediate period and help rotation of investors’ money faster, thereby enhancing the subscription levels in the forthcoming IPOs,” Chetan Majithia, Head, CRISIL Equities, said.
CRISIL Equities estimates about Rs40,000 crore will be raised from IPOs in 2010. To calculate the interest cost savings, CRISIL has used the observed three-year average subscription level of 8 times in the retail category and 28 times in the HNI category from 2007 till date. Based on this, the reduction in timeline by 10 days is expected to translate into interest savings of Rs800 crore annually, at an opportunity cost of 10%.
The directive from SEBI, effective 1st May, is a step towards realigning the Indian market with the best practices in developed markets where the listing timeframe is three days from the closure of issue, CRISIL said.
The timeframe for listing on stock exchanges in developed markets such as the US, UK and Singapore is three days. Even in some emerging markets such as Brazil and Hong Kong, it is three days.
With the recent directive, SEBI hopes to realign the Indian market by gradually adopting practices prevailing in the developed markets. CRISIL Equities expects the timeline between IPO closure and listing to reduce further to around three to five days in line with global practices, the ratings agency added.
Some airlines have started talks with various foreign missions in India to take care of the stranded passengers from those countries
Air India, Jet Airways and Kingfisher Airlines on Monday cancelled their flights to the UK and other parts of Europe in the wake of huge clouds of volcanic ash emanating from Iceland, reports PTI.
Air India and Jet would, however, operate their flights to the US and Canada by taking a diversion, sources in the airlines said.
An Air India spokesperson said the airline will operate its flights from New Delhi to New York and New York to Delhi and also Mumbai-New York and New York-Mumbai flights with a diversion through a polar route. A polar route refers to an aircraft route across the uninhabited polar ice cap region.
Jet Airways has also started its Delhi-Toronto and Mumbai-New York flights with a technical stopover at Athens in Greece.
Some airlines have started talks with various foreign missions in India to take care of the stranded passengers from those countries.
Maintaining that they had already provided full accommodation and other facilities to hundreds of passengers for the past 2-3 days, they also said they were finding it difficult to continue this facility any longer.
Airline sources also said the carriers could not be held liable for disruption of flight operations under such circumstances.
Under the brand licensing agreement, Videocon will assume the responsibility of selling and after sale services of Philips consumer television sets in India
Netherlands-based consumer durables major Philips on Monday said it has entered into a five- year licensing agreement with Videocon to market its television sets in India, reports PTI.
"We have entered into a brand licensing agreement with Videocon under which it will assume the responsibility of selling and after sale services of Philips consumer television set in India," Philips India chief executive Murali Sivaraman told reporters in New Delhi.
He further added that under this agreement, Videocon, which has a large integrated presence in the country, will sell Philips colour television sets manufactured by Videocon according to the specifications and standards maintained by Philips globally.
The company expects that with the help of the large sales and distribution network of Videocon, it will increase the presence of television sets in the country significantly.
Philips, which has been operating in India for more than 80 years, earlier said that it is strategically shifting its focus to the healthcare and lifestyle segments.
Videocon recently failed to acquire Finland-based consumer electronics maker Elcoteq. Last September, both companies had announced that they have signed a non-binding letter of intent (LoI) for negotiating and finalising a potential Definitive Transaction Agreement.