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Kotak Bank to sell 20 cr shares of Airtel Payments Bank to Bharti Enterprises for Rs 294 cr

Kotak Mahindra Bank on Tuesday said it will sell 20 crore shares held in Airtel Payments Bank (APBL) for a cash consideration of Rs 294 crore or more to Bharti Enterprises Ltd.

A share purchase agreement has been executed by the bank for divestment of 20,00,00,000 equity shares (8.57 per cent stake) held by Kotak Mahindra Bank Ltd in APBL. These shares were acquired for Rs 200 crore invested in tranches during calendar years 2016 and 2017, the bank said in a regulatory filing.

The sale is expected to be completed by September 15 or before, for “cash consideration equal to or higher than Rs 294.8 crore; to be determined in accordance with the terms of the share purchase agreement,” it added. APBL was incorporated on April 1, 2010, under the RBI license for payments banks.

It commenced its operations as a payments bank, with effect from November 23, 2016. The company’s turnover was Rs 627.19 crore in FY 20. The bank said it does not require any governmental or regulatory approvals for the proposed transaction.

Bharti Enterprises has received no objection from the RBI to enable execution of the proposed transaction, it said. Stock of Kotak Mahindra Bank traded at Rs 1747.40 apiece on BSE, up 0.66 per cent from the previous close.

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Ami Organics Rs 570-crore IPO opens Sep 1; check grey market premium, price band, lot size, bid details

Ami Organics Rs 569.63-crore IPO will open for subscription on 1 September 2021, at a price of Rs 603-610 per equity share of face value of Rs 10 each. So far this year, Ami Organics IPO is the 40th issue. Despite filing the preliminary papers with SEBI, the company could not float the IPO in 2018. This is the company’s second attempt at a public issue. In the primary market, Ami Organics shares were seen quoting at a premium of Rs 67 over the IPO price. In the grey market on Friday, Ami Organics shares were trading at Rs 677, a premium of 11 per cent over the issue price, according to the people who deal in unlisted shares of the companies.

Ami Organics will join the likes of Aarti Industries, Hikal Ltd, Valiant Organics, Vinati Organics, Neuland Organics and Atul Ltd, once it completes its IPO. Investors can make bids for a minimum of 24 equity shares and in multiples thereafter. This will translate to a minimum investment amount of Rs 14,640 per lot at the upper end of the price band. Up to half of the net offer will be reserved for Qualified Institutional Buyers (QIBs), 35 per cent for retail investors and the remaining 15 per cent for non-institutional investors (NIIs). The price/earnings ratio based on diluted EPS on a restated consolidated basis for FY 21 for the issuer at the upper end of the price band is as high as 35.59 as compared to the average industry peer group PE ratio of 48.91. The weighted average return on net worth for last year fiscals is 29.09 per cent.

Organics is one of the major manufacturers of Pharma Intermediates for certain key APIs, including Dolutegravir, Trazodone, Entacapone, Nintedanib and Rivaroxaban. Along with the domestic market, Ami Organics supplies Pharma Intermediates used for manufacturing APIs and NCEs to various multi-national pharmaceutical companies which cater to the large and fast-growing markets of Europe, China, Japan, Israel, UK, Latin America and the USA. “Ami Organics has continually invested in R&D activities to stay ahead and create a differentiating factor and sustainability vis-àvis their competitors,” Axis Capital said in an IPO note.

Recently, Ami Organics has completed the acquisition of two additional manufacturing plants operated by Gujarat Organics Ltd (GOL) in line with its inorganic growth strategy of foraying further into the specialty chemicals sector. Specifically, subsequent to the acquisition, it has acquired the preservatives (parabens and parabens formulations which have end usage in cosmetics, animal food and personal care industries) and specialty chemicals business of GOL (with end usage in inter alia the cosmetics, dyes, and agrochemicals industries).

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ICICI bank files cheating case against Karvy Stock Broking Ltd

A case has been registered against Karvy Stock Broking Ltd promoter C. Parthasarathy and others for allegedly cheating ICICI Bank to the tune of Rs 563 crore. According to a press release issued by the police on Tuesday night, the case was booked under Sections 406 (criminal breach of trust), 420, r/w 34 ( cheating) of IPC against the accused.

Funds raised by KSBL by pledging shares of its six bankers were transferred to the firm’s own bank accounts, and not into ‘Stock Broker Client Account’, which is in contravention with the SEBI guidelines, the police said.

”Further, all pledges on securities were closed without approval and securities were transferred to end clients of KSBL thereby severely impacting security of all lenders including ICICI Bank,” it said.

The case was transferred to Economic Offences Wing of Cyberabad and a special team was formed for the investigation. Parthasarathy was arrested by the city police here on August 19 on charges of defaulting on a Rs 137 crore loan taken from IndusInd Bank.

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RBI to pump Rs 50,000 crore via G-SAP 2.0 in August

The Reserve Bank of India on Friday said it will undertake a secondary market government securities acquisition programme or G-SAP 2.0 worth Rs 50,000 crore in two tranches this month to enable an orderly evolution of the yield curve.

“Our recent G-SAP auctions that have focussed on securities across the maturity spectrum are intended to ensure that all segments of the yield curve remain liquid,” RBI Governor Shaktikanta Das said while announcing the third bi-monthly monetary policy. The Reserve Bank’s secondary market G-sec acquisition programme (G-SAP) has been successful in anchoring yield expectations while eliciting a keen response from market participants, he noted.

“We propose to conduct two more auctions of Rs 25,000 crore each on August 12 and August 26, 2021, under G-SAP 2.0. We will continue to undertake these auctions and other operations like open market operations (OMOs) and operation twist (OT), among others, and calibrate them in line with the evolving macroeconomic and financial conditions,” he said.

Under the revised liquidity management framework announced on February 6, 2020, the Reserve Bank has been conducting 14-day variable rate reverse repo (VRRR) auctions as its main liquidity operation. With the commencement of normal liquidity operations, the VRRR, which was temporarily held in abeyance during the pandemic, has been re-introduced from January 15, 2021, and the initial absorption of Rs 2 lakh crore has been rolled over in the subsequent fortnightly auctions, Das said.

In parallel, access to the fixed-rate overnight reverse repo has been kept open, he said, adding markets have adapted and even welcomed the VRRR in view of the higher remuneration it offers relative to the fixed-rate overnight reverse repo.

“Fears that the recommencement of the VRRR tantamount to liquidity tightening have been allayed. We have seen a higher appetite for the VRRR in terms of the bid-cover ratio in the auctions,” he noted. Considering all these aspects, it has now been decided to conduct fortnightly the VRRR auctions of Rs 2.5 lakh crore on August 13, 2021; Rs 3 lakh crore on August 27, 2021; Rs 3.5 lakh crore on September 9, 2021; and Rs 4 lakh crore on September 24, 2021, he said.

“These enhanced VRRR auctions should not be misread as a reversal of the accommodative policy stance, as the amount absorbed under the fixed-rate reverse repo is expected to remain more than Rs 4.0 lakh crore at the September-end 2021. Needless to add that the amount accepted under the VRRR window forms part of system liquidity,” he said.

On additional liquidity measures, the governor said the scope of the on-tap TLTRO scheme, initially announced on October 9, 2020, for five sectors, was further extended to the stressed sectors identified by the Kamath Committee in December 2020 and bank lending to NBFCs in February 2021.

The operating period of the scheme was also extended in phases till September 30, 2021. Given the nascent and fragile economic recovery, it has now been decided to extend the on-tap targeted long-term repo operation (TLTRO) scheme further by a period of three months till December 31, 2021, he said.

On March 27, 2020, he said, banks were allowed to avail of funds under the marginal standing facility (MSF) by dipping into the Statutory Liquidity Ratio (SLR) up to an additional one per cent of net demand and time liabilities (NDTL), i.e. cumulatively up to 3 per cent of NDTL.

To provide comfort to banks on their liquidity requirements, including meeting their Liquidity Coverage Ratio (LCR) requirement, this relaxation which is currently available till September 30, 2021, is being extended for a further period of three months, up to December 31, 2021. This dispensation provides increased access to funds to the extent of Rs 1.62 lakh crore and qualifies as high-quality liquid assets (HQLA) for the LCR.

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