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After Paints, Kumar Mangalam Birla All Set To Disrupt Cable & Wire Sector
Disruption or disruptor are terms used in connection with the startup ecosystem. Take for example the way the cab business got disrupted by the ride hailing apps or the food delivery apps that disrupted the way you ordered food. These companies were well funded and they began their early part of the journey by burning loads of money and gaining relevance in the marketplace. Switching into time and the first time something different than a startup player becoming a disruptor happened was when Kumar Mangalam Birla through Grasim announced his entry into the decorative paints industry through Opus paints. With the start of its 4th factory in Karnataka, he is already the second largest in terms of capacity in the decorative paints industry. It is expected that this paints division would have a turnover of Rs 8000-10,000 crore in three years’ time. Asian Paints which reported a revenue of Rs 35,000 crore for the year ended March 2024 saw its market cap fall by more than 40% after Opus entered the fray and well before it has become a sizable player in terms of size and market share. Recently, Kumar Mangalam Birla did the same thing in the cement sector. One of his group companies, UltraTech Cement announced its plans to enter the cables industry with an investment of Rs 1,800 crore for setting up a cable plant. The two key raw materials for this are copper and aluminium, of which Hindalco Industries, a group company, is one of the top two producers. This mere announcement shook the incumbents and the top players cumulatively lost a market cap of over Rs 50,000 crore in a single day. 
gold sensex
Sensex Or Gold: Which Will Hit The 1-Lakh Mark In 2025?
Gold is all about safety and it appears that presently the geo-political situation seems to be at status-quo with a possibility that things may improve. Customs duty is something which can spook prices but with the cut in duties earlier this year, even that event is currently ruled out. Rupee depreciation has happened over the last few months, but further sharp downside may be difficult. Sensex is a reflection of the economy and though we seem to be having a tough time it’s still at a level where we are better than most large economies. Other than crude oil and edible oil, we are a fairly self-consuming country. Markets have done well with the Sensex gaining about 10% in the year to hover around 78,000 points while gold rose by 22% to Rs 76,000. This includes the gains on account of the reduction in customs duty. Knowing our humongous capacity for buying and storing gold, to expect that prices would move by another 31% in calendar year 2025 and touch the Rs100,000 mark look most unlikely. In the same breath, expecting Sensex to move 26% and touch 100,000 points either is also tough. Foreign Portfolio Investment or FPI selling, valuations at elevated levels even though they have softened is still expecting too much. I believe the expectation that the race to touch 1 lakh for gold or 100,000 points for Sensex is unlikely to happen in the coming 12 months. Both gold and Sensex are more likely to touch the 1-lakh mark in the calendar year 2026. Is there a tilt towards one of the two? Yes. The shine and lure of gold is much more than equity even though over the last four years equity investors have grown over four times. 
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Are Adani Stocks On A Comeback Trail?
The Adani group and its shares have been under tremendous pressure over the last five weeks since the report from Hindenburg hit the markets. 2nd March was a great day — a big comeback of sorts for Adani. GQG Partners Emerging Markets Equity Fund invested Rs 15,500 cr approx. in four of Adani’s companies. These shares were bought from the Adani family. The price at which these shares were bought are Rs 1,408.25 for Adani Enterprises, Rs 504.60 for Adani Green Energy, Rs 596.20 for Adani Ports and SEZ, and Rs 668.40 for Adani Transmission. These prices at which the deal was done would become a benchmark for valuation going forward. In the near foreseeable future these prices would not break unless a new disaster hits the stock markets. On the same day, the Supreme Court appointed a six-member panel to look into the allegations against the group and submit a report in a sealed cover within two months. This would clear doubts raised by Hindenburg, the continuous disruption in Parliament would now stop and alleged cronyism, a charge raised by the Opposition would also be resolved. The proof of the pudding is in the eating and at the time of writing this article the share prices of three of the four stocks mentioned have gained between 11.13% to 11.32% (as they are subject to a 5% circuit filter) and the fourth has gained a staggering 29.8%.
BSE_ NSE
New Subscription Rules By RBI, SEBI For IPO To Hit HNIs, See Grey Market Vanish
Come April 1, 2022, the IPO market will witness three major changes that will immensely benefit retail investors. First, as per RBI stipulation, investors cannot borrow over Rs 1 crore from NBFCs to apply for an IPO. Second, SEBI has split the current HNI category into two. The first part, 1/3 of the bucket size of HNI portion, is for Rs 2-10 lakh and, the second bucket size of Rs 10 lakh and above  is for HNI-Non-Institutional Investors. Third: change in lock-in period for anchor investors from current 30 days in two bucket groups: 50% shares will have 30-day lock-in and balance 50% for 90 days. Clearly, institutional investors are uncomfortable with the 90-day lock-in with good reason. The last three months saw all new age companies losing around 50% values since their listing. Allotment for HNI category, in case of oversubscription, would be similar to the retail category with one lot per applicant.  For example, in the Rs 2 lakh plus category it would be just Rs 2 lakh. Similarly, it would be Rs 10 lakh in the Rs 10 lakh plus category. The new rules will see unrealistic over subscriptions by over 200-300 times disappear to more realistic levels in turn, making grey markets vanish. It will also force promoters to price IPOs more realistically.
BSE_003
RBI’s New IPO Rule To Hit HNIs, Grey Market Hard
Currently, IPO subscription in India is skewed to favour the leveraged HNI and subject to a very high degree of money power. Come April 1, 2022, this is set to undergo a major change with the RBI directing that no individual can be lent more than Rs 1 crore to apply for shares in an IPO. The immediate ramifications will be huge. Firstly, the number of times the HNI portion is subscribed will fall sharply from the present 100-800 times to maybe 5-10 times. The present grey market premiums which decide the subscription level will no longer exist at these levels as the subscription will not match. The reverse math will not allow such premiums to remain. The pricing of issues will go through a downward pressure as merchant bankers, promoters and PE Investors will no longer have the luxury to depend on leveraged HNI to back them. The standard practice of every issue opening at a premium of 20-30% of the issue price will simply stop.  What would the new scenario look like? Probably more subdued and balanced. IPO price band would be realistic and listing gains of 10% would be a great number. HNI subscription being in single digit would be the new norm as SEBI would also have notified the new norms of splitting the HNI bucket into two. For retail investors it is a welcome move.
punit_shallu_siddharth
Rising Shareholder Activism Keeping Promoters On The Hook
Shareholder activism has been gaining currency and managements have to think twice before proposing resolutions to be approved and voted by shareholders. SEBI is also ensuring that it becomes difficult for promoters to push anything just because of their majority stake. For every negative vote, you now need three positive votes to approve the resolution. In some cases, the promoter is not allowed to vote and the minority shareholders decide the outcome. Readers would recall that Eicher Motor shareholders rejected a pay hike to Sidharth Lal, its MD & CEO. Similarly, IDFC shareholders rejected the reappointment of Vinod Rai as independent director. In the case of Zee Entertainment, two directors stepped down on the eve of the AGM as proxy advisors had asked the shareholders to vote them out. Meanwhile, the company which announced a non-binding agreement sale to Sony Entertainment has been directed by NCLT Mumbai bench to consider shareholder Invesco’s request for EGM to oust MD Punit Goenka. Jindal Steel & Power wants its shareholders to approve payment of one-time remuneration to its four independent directors. Proxy holders are advising shareholders to oppose the same as it violates terms of an independent director. Further an investor has rejected the reappointment of Shallu Jindal, wife of Naveen Jindal and a director on the board of the company for nine years. Indeed, it is a tough time for promoters.
Sebi
Shareholders’ Plea: Quit The Board, As Moral Turpitude Is Implicit In Disgorgement
SEBI, the capital markets regulator, has been aggressively issuing orders against entities found violating rules and making illegal gains using unpublished price sensitive information or ‘UPSI’. These orders involve consent terms for the violation and settling without admitting guilt, and also a component of ‘Disgorgement’. The term ‘disgorgement’ is defined as “the act of giving up something (such as profits illegally obtained) on demand or by legal compulsion. This brings us to a bigger and more important point of moral turpitude. Does an individual who sits on a board of a listed company as an independent director and has disgorged an amount to a regulator along with the promoter of the same company for illegally benefiting from USPI committed moral turpitude? The fact that he has used the same information as the promoter has, is testimony to the fact that he is no longer independent. Similarly, when a senior officer of an I-banker acts in a similar manner and disgorges money, the fact that he has settled consent terms amounts to having committed a breach of confidentiality. In such cases without exception, strictest of action needs to be taken and the concerned person should be asked to leave. It is time for Corporate India and minority shareholders to take the matter of ‘UPSI’ seriously and demand that action be taken against erring individuals.
BSE_002
Will Sensex Make New History In June?
Covid-19 has been affecting the global economy for about 15 months now, yet global markets seem to be doing well. Dow Jones is at a lifetime high and the Indian markets too have been doing reasonably well. The BSE SENSEX is a mere 600 points shy of its lifetime high of 51,259 points made on February 16, while NIFTY is 234 points away from the level of 15,431 points. In India, companies have learnt how costs can be controlled. Travel and travel related expenses have come down significantly. FMCG and consumer companies have also adopted WFH with unbelievable savings and performance. The bulls have complete control of the markets and there are many factors which support them: 1) The FIIs or FPIs continue to invest in India; 2) the second wave appears to have been arrested in a major way and the infrastructure has improved significantly in the intervening period; 3) the monsoon forecast is positive; 4) inflation is under control and interest rates are quite soft; 5) there is enough liquidity in the system in India to spur growth. There is a talk of a third Covid wave happening and hopefully we would be well prepared for the same. The fact that there is a huge trust deficit about China post the pandemic, more and more companies globally are putting in place a policy of China plus one supplier. India is an automatic choice for the one spot and we are seeing traction on this front. Considering all these factors, it becomes almost a certainty that the stock markets would see a new lifetime high in the month of June 2021. That would give us another six months before the calendar year ends and the possibility that markets moving another 5-7% looks distinctly possible.
black money
How Politicians Find Newer Ways To Take ‘Speed Money’
Speed money is a term regularly used to get work done when dealing with the various government agencies. ‘Green Tax’ was the term used to get work done from the environment ministry in the previous government. With the current government bringing in more transparency and plugging loopholes to make it tougher to make ‘money on the side’, the politicians too are becoming smarter –finding ‘legitimate’ ways to take speed money. I learnt of one such method while interacting with an industrialist of a leading diversified listed conglomerate. This group was to set up a new manufacturing plant in one of the states and was given two options by the politician. The first was the conventional cash. The second option was to invest in the equity capital of an unlisted company at ridiculously high valuations. Since he did not hoard black money, the industrialist chose the second option. The modus operandi was simple. His group invested in a company that had no operating business, hence was basically a paper company or a shell company. On paper it looked like a fraudulent transaction but would never get questioned. This company had many such ‘investors’ who invested to get their work done. ”I am willing to spend money and pick shares in such shell company, even if at a later date I have to write off the investments,” he explained. Ingenuity thy name is politicians!

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Editor’s Note: Short Post Noticed By People Who Matter

Four years have zipped by and we are crossing another milestone on 31st January 2025 – it’s our 4th Anniversary. It feels good.
Looking back at the 1460 days, I must say Short Post has made its mark with people who matter via 4000 stories published in the areas of politics, business, entertainment and sports. All made possible by the unflinching commitment and dedication of our senior editors, most of whom have been part of this journey from Day One.
Small pack, big impact is in essence the story of Short Post which was launched at the height of the Covid-19 pandemic in 2021. It shows our conviction. In all humility, I can say, we have created a new niche in the news segment space like Hindustan Unilever which created a new segment, when it launched CloseUp Gel.
Yes, we have created a brand (in a limited sense), created demand (readers) and created supply (senior journalists). But we are facing teething problems like all start-ups. What makes us happy and confident is the recognition of our efforts. For instance, we have an arrangement with the OPEN Magazine, part of the $4.5 billion Kolkata-based Sanjiv Goenka-RPG Group. This arrangement sees around 10 Short Post stories posted on OPEN Magazine website every week. This arrangement is testimony that our content has been well received! Also, I may add that the Maharashtra government has recognised Short Post and has allowed our senior editor to cover the Assembly sessions. Ditto: Odisha.
Our goal is to ensure that Short Post becomes a habit. I would like people to keep checking their smartphones to know the latest Authentic Gossip. As regards AI and the fear of it disrupting all businesses including media. On that, personally, I have no such fear as I am confident AI cannot smell news particularly Authentic Gossip. That’s the place we are well entrenched.