The week ahead is going to be particularly data heavy with first quarter GDP estimates from the National Statistical Office and IIP data for July due on Monday. This, followed by auto sales monthly data and Markit Manufacturing PMI on Tuesday. Another item that will be in focus next week will be the new mechanism on margin pledge in cash market is due to come into force from September 1. Though the Association of National Exchanges Members of India (Anmi) on Friday urged markets regulator SEBI to extend the implementation till September 30, there hasn’t been any official nod to the idea as yet. Globally, all eyes will be on the deteriorating relations between US and China, which could get hostile in the run-up to US presidential elections on 3rd November. Let us look at the stocks that will be in focus as markets open on Monday:
Reliance Industries-Future group deal: The eagerly anticipated deal between Reliance Industries and Future group came through over the weekend. The Kishore Biyani led group will sell its retail, wholesale, logistics and warehousing assets to Reliance Industries' retail arm Reliance Retail Ventures at a value of Rs27,513cr. The deal is subjected to adjustments as set-out in the composite scheme of arrangement (Scheme), RIL said in a press release on Saturday. As part of the deal-
- All key Future group companies - Future Retail, Future Lifestyle Fashions, Future Consumer, Future Supply Chain Solutions and Future Market Networks will be merged into Future Enterprises.
- As part of the agreement, the retail and wholesale business of Future Group will be transferred to Reliance Retail and Fashion Lifestyle Limited (RRFLL), a wholly-owned subsidiary of Reliance Retail Ventures Limited (RRVL).
- Reliance Retail will take over certain borrowings and current liabilities as part of the business and pay the rest in cash.
- Future Enterprises will also transfer assets of the logistics and warehousing business on a slump sale basis to Reliance Retail for Rs 25.22cr.
- Reliance Retail to invest Rs 1,200cr in a preferential issue of Future Enterprises for a 6.09% stake.
- Shares of the preferential issue and warrants will be issued at Rs 17.65 apiece.
- ITC Ltd: The conglomerate said it is considering merger of its three wholly-owned subsidiaries - Sunrise Foods, Hobbits International Foods and Sunrise Sheetgrah - with itself. A board meeting of the company has been convened for this on 4th September 2020, ITC informed in a filing to the stock exchanges post market hours Friday.
- ABB Power Products and Systems India Ltd: The company has informed the stock exchanges about increasing its offer price for shares it plans to buyback through an open offer. "The Acquirers and the PAC (person acting in concert) have decided to revise the offer price upwards from Rs865.92 per Offer Share to Rs872.68 per offer share, consisting of ₹851 per offer share plus interest of ₹21.68 per offer share, computed at the rate of 10% per annum, for the period between 30 March 2020 (being the date of making the public announcement) and 1 July 2020 (being the date of completion of closing)," ICICI Bank, merchant banker of ABB Power’s open offer said in the statement.
- Indiabulls Ventures Ltd: The company’s board has approved preferential issue of 3.36cr equity shares at Rs175 per share worth Rs588cr. Investors like Think India Opportunities Fund, TIMF Holdings, Ribbit Cayman Holdings, Inteligo Bank, NWI Emerging Market Fixed Income Master Fund and First Royalty Ventures have been allotted shares. The board has appointed Sameer Gehlaut as the company's Chairman and CEO.
- RBL Bank: MD & CEO, Vishwavir Ahuja sold 18.93 lakh shares between August 27-28 worth Rs38.52 cr to meet personal debt obligations. The number of shares sold is approximately 18% of his or his family's aggregate holdings of the bank as on date.
- Suzlon Energy Ltd: The company reported widening of its consolidated net loss to Rs398.86cr in the April-June quarter compared to the year-ago period mainly due to lower revenues. Additionally, the company stated that the group's ability to generate sufficient cash flows to meet its financial obligations in the foreseeable future could be impacted by the undetermined circumstances arising from the pandemic.
- CG Power and Industrial Solutions Ltd: Murugappa group's Tube Investments of India Ltd has been declared as the successful bidder for acquiring the majority stake in the company. The bid is, however, subject to the approval of the Competition Commission of India and also the lenders, said the company in a stock exchange notification late Friday night.
- Vedanta Ltd: The mining conglomerate has pledged its entire shareholding in subsidiary Hindustan Zinc Ltd (HZL) to help fund its proposal to delist from the stock exchanges. Hindustan Zinc in a statement to the stock exchanges on Saturday showed that Vedanta, the majority owner of the company, had created an encumbrance on its entire shareholding of 64.92% through the share pledge and non-disposal undertaking in favor of SBICap Trustee Co. Ltd. The transaction includes about 2.1bn shares by non-disposal undertaking and 6.26bn shares in pledge.
- Inox Wind Ltd: The company, in a meeting held on Friday, approved raising up to Rs200cr through issuance of securities by way of a private placement (including but not limited through a qualified institutional placement) in accordance with the provisions of the applicable law. The fund raising is subject to necessary permissions, sanctions and approvals, including shareholders' approval.
- HCL Technologies Ltd: The software maker’s US subsidiary, HCL America, is facing a patent infringement claim related to one of its software products. HCL America is due to respond to the lawsuit filed by a Texas-based company, Coretek Licensing, by 28th September.
U.S. stocks remained buoyant Friday, hitting fresh records, a day after the Federal Reserve announced a policy shift that would propel employment and inflation. The Dow Jones closed higher by 161.60 points, or 0.6%, at 28,653.87, while the S&P rose 23.46 points, or 0.7%, to close at 3,508.01. The Nasdaq Composite advanced 70.30 points, 0.6%, to 11,695.63.
Federal Reserve Chairman Jerome Powell announced that the Fed was shifting to a policy of average inflation targeting which would effectively see policy makers end the practice of preemptively hiking interest rates to stave off inflation.