I had written about Indiainfoline a few days ago...the scrip has moved up by around 25% since then. Its up 20% today. Takeover, private placement or just rising with the overall market? Any guesses?
Update: 7-Nov-06: The scrip went further up today. Closed the day at 279, up 11% over the previous close. That means a gain of around 40% since I wrote about it a few days ago...phew!!
Another update: 9-Nov-06: India Infoline is up another 12% today. And is currently quoting at Rs.296. Intra-day high for the scrip was 306.....some run-up this!!
Monday, November 06, 2006
Monday, October 30, 2006
Shaking foundations, says the Time on Mr.Ratan Tata
The Time Magazine has an article on Mr.Ratan Tata, the chairman of the Tata group. A small excerpt:
You wouldn't expect the head of Tata group, India's largest conglomerate, to say the rich are boring. But Ratan Tata comes close. Acting rich doesn't interest him. "I've never had the desire to own a yacht, to flaunt," he says. Nor does the Prada-wearing class excite him as a marketing opportunity. China and India, with their growing ranks of tycoons, should attract multinational businesses, not because of the spare million in a few fat wallets, he argues, but because of the spare change in a billion slim ones. "Everyone is catering to the top of the pyramid," says the 68-year-old at his office in Bombay House, Tata group's elegant Edwardian headquarters in India's business capital. "The challenge we've given to all our companies is to address a different market. Pare your margins. Create new markets."
Always a great feeling to see an Indian company taking up the challenge of becoming global and then becoming one. Unlike in the past when some of the great Indian brands simply sold out to MNCs. The best example that I can think of is the sell-out of the soft drink brands - Thumbs Up, Limca, & Gold Spot. I think these brands had in them what it takes to be global....maybe there promoters did not. The entire article on Mr.Tata in the Time Magazine can be read here.
You wouldn't expect the head of Tata group, India's largest conglomerate, to say the rich are boring. But Ratan Tata comes close. Acting rich doesn't interest him. "I've never had the desire to own a yacht, to flaunt," he says. Nor does the Prada-wearing class excite him as a marketing opportunity. China and India, with their growing ranks of tycoons, should attract multinational businesses, not because of the spare million in a few fat wallets, he argues, but because of the spare change in a billion slim ones. "Everyone is catering to the top of the pyramid," says the 68-year-old at his office in Bombay House, Tata group's elegant Edwardian headquarters in India's business capital. "The challenge we've given to all our companies is to address a different market. Pare your margins. Create new markets."
Always a great feeling to see an Indian company taking up the challenge of becoming global and then becoming one. Unlike in the past when some of the great Indian brands simply sold out to MNCs. The best example that I can think of is the sell-out of the soft drink brands - Thumbs Up, Limca, & Gold Spot. I think these brands had in them what it takes to be global....maybe there promoters did not. The entire article on Mr.Tata in the Time Magazine can be read here.
Saturday, October 28, 2006
Why do we have a 10-digit mobile number? Why not 6/7/8/9-digit?
Why do we have 10-digit mobile numbers? This is probably something most of us do not really think about. But it has a very sound logic to it. And, I realised the same today while reading a book "Innumeracy" by John Allen Paulos.
The logic: The number of digits in a mobile phone number decide the maximum mobile phones we can have without dialing the country code, ie. 91 (for India). To understand this we need to go back to school. Remember permutations & combinations. Suppose I had a pair of jeans (J1-2) and four tee-shirts (T1-4). The possible combinations are: J1T1, J1T2, J1T3, J1T4, J2T1, J2T2, J2T3, and J2T4, ie. 8 combinations {2 (no. of jeans) X 4 (no. of tee-shirts)}.
The same logic is used when computing the digits in a mobile phone number or for that any numbers such as those for vehicles, land-line telephone numbers, etc. Now suppose if we had a 6-digit cell number, the maximum number of unique cell numbers possible would have been (10 x 10 x 10 x 10 x 10 x 10), ie. a maximum of 1,000,000 subscribers. We have already crossed the 100-million mark in India. So obviously we could not have had a 6-digit cell phone number. Not even a 7-digit because that would've resulted in a capacity of 10 million, not even 8-digit (100 million subscribers), and not even a 9-digit (ie. 1000 million or 100 crore, since our population is close to 125 crore and growing).
A 10-digit cell number offers us a capacity to have 10 billion (1000 crore) subscribers, which is far more than what our country can even achieve. We are v.v.v.unlikely to have a population or a subscriber base of 1000 crore but there is a remote likelihood of us having 100 crore subscribers. Hence, a 10-digit mobile phone number.
The logic: The number of digits in a mobile phone number decide the maximum mobile phones we can have without dialing the country code, ie. 91 (for India). To understand this we need to go back to school. Remember permutations & combinations. Suppose I had a pair of jeans (J1-2) and four tee-shirts (T1-4). The possible combinations are: J1T1, J1T2, J1T3, J1T4, J2T1, J2T2, J2T3, and J2T4, ie. 8 combinations {2 (no. of jeans) X 4 (no. of tee-shirts)}.
The same logic is used when computing the digits in a mobile phone number or for that any numbers such as those for vehicles, land-line telephone numbers, etc. Now suppose if we had a 6-digit cell number, the maximum number of unique cell numbers possible would have been (10 x 10 x 10 x 10 x 10 x 10), ie. a maximum of 1,000,000 subscribers. We have already crossed the 100-million mark in India. So obviously we could not have had a 6-digit cell phone number. Not even a 7-digit because that would've resulted in a capacity of 10 million, not even 8-digit (100 million subscribers), and not even a 9-digit (ie. 1000 million or 100 crore, since our population is close to 125 crore and growing).
A 10-digit cell number offers us a capacity to have 10 billion (1000 crore) subscribers, which is far more than what our country can even achieve. We are v.v.v.unlikely to have a population or a subscriber base of 1000 crore but there is a remote likelihood of us having 100 crore subscribers. Hence, a 10-digit mobile phone number.
Friday, October 27, 2006
Who is financing India's largest LBO; Tata Steel-Corus deal
Financeasia has an insight into how India's biggest ever leveraged buyout, Tata Steel's takeover of the UK-based Corus Steel, was financed. An excerpt from the article:
The financing package accompanying Tata Steel's $8.23 billion leveraged buyout of UK steel producer Corus is multi-faceted. The deal, which sees Tata assume some debt on the Corus balance sheet and agreed pension liabilities, comprises a $3.88 billion equity contribution from Tata Steel, a fully underwritten non-recourse debt package of $5.63 billion, and a revolving credit facility of $669 million. The deal represents India’s largest cross-border outbound acquisition ever and also the largest leveraged buyout (LBO) attempted by an Indian company.
Tata Steel appointed ABN AMRO and Deutsche Bank to advise on the transaction and raise the required financing for the acquisition. But somewhere along the way, the appointed banks were unable to commit the debt required. Sources close to the deal suggest the transaction was almost derailed at this stage.
So Corus turned to a bank it was close to, Credit Suisse, to resolve the impasse. Credit Suisse was advising Corus on the Tata deal.
Read the full article here.
The financing package accompanying Tata Steel's $8.23 billion leveraged buyout of UK steel producer Corus is multi-faceted. The deal, which sees Tata assume some debt on the Corus balance sheet and agreed pension liabilities, comprises a $3.88 billion equity contribution from Tata Steel, a fully underwritten non-recourse debt package of $5.63 billion, and a revolving credit facility of $669 million. The deal represents India’s largest cross-border outbound acquisition ever and also the largest leveraged buyout (LBO) attempted by an Indian company.
Tata Steel appointed ABN AMRO and Deutsche Bank to advise on the transaction and raise the required financing for the acquisition. But somewhere along the way, the appointed banks were unable to commit the debt required. Sources close to the deal suggest the transaction was almost derailed at this stage.
So Corus turned to a bank it was close to, Credit Suisse, to resolve the impasse. Credit Suisse was advising Corus on the Tata deal.
Read the full article here.
Wednesday, October 25, 2006
Early bookings on! Take ur pick in the domestic broking biz, Investsmartindia, Geojit, Indiabulls, Sharekhan....
The domestic stock broking business looks to be headed for days of hectic M&A activity. We may soon have a whole host of foreign companies buying out Indian companies. Things have started moving in this direction already. Take a look at some of the deals that have been struck over the past few months:
1). Sharekhan (Promoted by SSKI): Interested parties - New Atlantic Partners and IDFC.
2). Investsmartindia (Promoted by IL&FS): E*Trade.
3). Geojit Financial Services: BNP Paribas.
4). Motilal Oswal: New Vernon Private Equity Ltd and Bessemer Venture Partners.
5). Indiabulls: No single strategic investor. But there seems to be a beeline of foriegn investors for this company. They have a phenomenal 53 per cent stake in this company. See the Sept'06 shareholding pattern.
I think quite a few of these will be sold off sooner than later. Their share prices have witnessed good jump in recent times. However, among the listed broking firms, there is one company called "Indiainfoline". This company has so far remained out of the limelight. Difficult to believe that it hasn't been approached by any of the large foriegn investor yet. I think something could be cooking up here as well. My conspiracy theory is that it will be bought out by Anil Dhirubhai Ambani's new venture R Trade. Having already missed the rally in Indiabulls, IL&FS Investsmart India, Geojit; Indiainfoline is a company one should watch out for in days to come.
1). Sharekhan (Promoted by SSKI): Interested parties - New Atlantic Partners and IDFC.
2). Investsmartindia (Promoted by IL&FS): E*Trade.
3). Geojit Financial Services: BNP Paribas.
4). Motilal Oswal: New Vernon Private Equity Ltd and Bessemer Venture Partners.
5). Indiabulls: No single strategic investor. But there seems to be a beeline of foriegn investors for this company. They have a phenomenal 53 per cent stake in this company. See the Sept'06 shareholding pattern.
I think quite a few of these will be sold off sooner than later. Their share prices have witnessed good jump in recent times. However, among the listed broking firms, there is one company called "Indiainfoline". This company has so far remained out of the limelight. Difficult to believe that it hasn't been approached by any of the large foriegn investor yet. I think something could be cooking up here as well. My conspiracy theory is that it will be bought out by Anil Dhirubhai Ambani's new venture R Trade. Having already missed the rally in Indiabulls, IL&FS Investsmart India, Geojit; Indiainfoline is a company one should watch out for in days to come.
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