Disinvestment

Everyone Can Now Fly Private

Don't get too excited guys. We mean from a private airport, not a private jet.

The government is apparently planning to sell its stake in several airports in India.

Per a Business Standard report, the government wants to cash in on its shareholding in Delhi, Hyderabad, Mumbai and Bengaluru airports.

Wait aren't these private already?

Yes, you are right. The airports are already run by private companies but the Airports Authority of India (which is a government entity) has some shares left which they want to now sell.

The AAI has a 26% stake in Hyderabad, Bengaluru and Mumbai airports and a 10% stake in the Delhi Airport.

Lucky 13 Hopefully

Other than the 4 airports we've mentioned 13 new airports have been identified for privatisation in the upcoming financial year.

But things are going to be a bit different for these 13. 
The government is thinking of clubbing non-profitable airports with profitable ones so potential buyers see it as an attractive package. 

In the first round of airport privatisation drive that began last year, the Adani group was the big winner as they managed to get the contract for 6 of 13 airports listed by the government.

The government has a target of Rs 1.75 lakh crores for disinvestment proceeds in FY2021-22. We hope the target is met and this goes better than their attempt to sell an airline though (Air India 🙈)

IPO

IPO Szn In Full Bloom


The IPO of the day is brought to you by Laxmi Organic Industries Limited.
Even though this sounds like an ad, we haven't been paid a penny by anyone.
Now that we think of it, they could give us something🤔 
They’re raising Rs 600 crores in the IPO after all. 

The Company

Laxmi Organic is a chemical company btw, not some hipster organic food company.
They make Acetyl Intermediates and Specialty Intermediates.

The company has been around for over 30 years and is among the largest manufacturers of Ethyl acetate in India with a market share of approximately 30%.

We didn’t know what this was so we put on our scientist hats and did some research.
This nerdy website tells us that Ethyl acetate is a widely used solvent, especially for paints, varnishes, lacquers, cleaning mixtures, and perfumes. It’s also used to remove caffeine from coffee beans.

And it’s what’s called an ‘organic compound’ in chemistry. Hence the name Laxmi Organics.
Finally, it all makes sense.

Read more about the other chemicals they produce here.
 
Financials

• The recorded Rs 1,539 crores of revenue in the previous financial year (ended March 2020) and that resulted in a Rs 70 crore net profit.
• In the first six months of this FY, they have had Rs 814 crores of revenue and Rs 45 crores net profit.

The IPO

The company is looking to raise Rs 600 crores via an IPO that’s even split between a fresh issue of shares and an offer for sale (OFS).

The fresh issue will be worth Rs 300 crores and the company will use this money to set up a new manufacturing facility for fluoro speciality chemicals and also buy new machinery for its existing plants.

The balance of Rs 300 crores will be used to provide the promoters with an exit. The offer opens for subscription today.

Tech

Social Pawri Ho Rahi Hai

 

With everyone mostly staying at home it seems we are all looking to get more social online. And not on the existing consumer social media platforms.

After the recent Clubhouse craze, another app called Dispo seems to be getting quite popular in the US.
Here in India, we have a new social app called "Kutumb" that is spreading really quickly.

As you'd expect, when startups get popular they have VCs running after them with money.
Tiger Global is looking to invest $15-$20 million in Kutumb as per TechCrunch. If the planned round goes through they will be valued at $170 million!
Quite neat we'd say especially for a startup that is just 7 months old.

How come we haven't heard of it?

Kutumb is targeting what VCs like to call 'Bharat' - basically, tier 2 & 3 cities where a lot of the new internet users are going to come from. They've been positioning themselves as Reddit for Bharat.

But unlike Reddit where most of the groups are public, most of the groups here are private so someone needs to give you access.
So it's kind of like those private WhatsApp groups you are a part of, but they're on Kutumb instead, where the experience is much better.

The interesting thing is that they are tapping into some age-old values and creating communities based on culture, creed, beliefs and professions.

For example, there are communities for Railway Karmcharis (railway employees) and Bank Karmcharis (bank employees).
They also have groups or communities for castes and religious beliefs (A Khatu Shyam Temple community for instance)

The Takeaway

The funding from Tiger isn't secured yet but Kutumb seems to have grown really fast even without the money. They've grown to 11 million users in less than a year!

It is always interesting to see a consumer social app built specifically for India. Only time will tell how their journey goes.

• Take a look at this snake with 3 smiley face emoji patterns on its back that sold for a lot of money.
• A 2,400-year-old skeleton mosaic was found in Turkey that says: 'Be cheerful, enjoy your life. From that to 'Live, Laugh, Love' nowadays. Not much has changed we'd say.
• Watch this video of a kid who was born in 2020 and saw other children in the park for the first time.

If you have more time ...

• India's forex reserves are now the fourth highest in the world.
• Bank deposits grew by 12% and lending by 6.6% in February. Here are the details.
• Stanza Living is in talks to raise funds at a $600 million valuation.

Share The Gyst