In today’s briefing:
- Long ICICI (ICICIBC IN) Vs. Short HDFC (HDFCB IN): Spread Trade in High-Profile Indian Bank Pair
- Pine Labs Pre-IPO Tearsheet
- Adani Power (ADANIPOWER IN): Bangladesh Clears Dues, Strengthens Balance Sheet
- Nykaa Block – US$140m Selldown by Banga Family
- Crizac Limited IPO Analysis
- Steel Trade: India’s BIS Mandate Spurs Import Shock Amid Rising Global Protectionism
- Event Driven: Torrent Acquires JB Chemicals ~ The Second-Largest Pharma Deal in Indian History
- The Beat Ideas: Centrum Capital -Unlocking the Hidden Value from Unity Small Finance Bank
- India Coal Sector Q1 FY26: Private Miners Surge, CIL Stumbles
- Capillary Technologies India Ltd Pre-IPO Tearsheet
Long ICICI (ICICIBC IN) Vs. Short HDFC (HDFCB IN): Spread Trade in High-Profile Indian Bank Pair
- Context: The ICICI Bank (ICICIBC IN) vs. HDFC Bank (HDFCB IN) Price-Ratio has deviated more than two standard deviations from its one-year average, presenting a potential relative value opportunity.
- Highlights: Going long ICICI Bank (ICICIBC IN) and short HDFC Bank (HDFCB IN) targets a 2% return to the statistical mean reversion level. The pair has closely aligned fundamentals.
- Why Read: Essential for quantitative traders seeking mean-reversion opportunities, with detailed execution framework, risk management protocols, and historical simulation showing the statistical basis for this relative value play.
Pine Labs Pre-IPO Tearsheet
- Pine Labs (0568874D IN) is looking to raise up to US$1bn in its upcoming India IPO. The deal will be run by Axis, Citi, MS, JPM and Jefferies.
- Pine Labs (PL) is a fintech firm focused on digitizing commerce through digital payments and issuing solutions for merchants, consumer brands and enterprises, and financial institutions.
- According to a Redseer Report, PL was the largest player in issuances of closed and semi-closed loop gift cards by transaction value in India in FY24.
Adani Power (ADANIPOWER IN): Bangladesh Clears Dues, Strengthens Balance Sheet
- Adani Power faced nearly USD 900 million in overdue receivables from its 1,600 MW Godda plant under a long-term export PPA.
- Bangladesh resumed regular payments and cleared USD 437 million in June; future dues secured via Letter of Credit and sovereign guarantee.
- Working capital improves over 40%, interest costs fall by ₹300–400 crore, and credit upgrade likely; boosts cash flow and strategic flexibility.
Nykaa Block – US$140m Selldown by Banga Family
- Harindarpal Singh Banga, one of Nykaa’s early investors, aims to raise around US$140m via selling a 2% stake in FSN E-Commerce Ventures (NYKAA IN).
- He has been gradually reducing his holding, currently owns about 4.97% of Nykaa. Prior to Nykaa’s IPO in Nov 2021, he held a stake of 8.7% in the company.
- In this note, we run the deal through our ECM framework and comment on deal dynamics.
Crizac Limited IPO Analysis
- Crizac’s INR 860-crore, 100% OFS IPO opens at INR 233-245, giving investors exposure to its fast-growing B2B overseas-education marketplace.
- International student demand is booming, yet 95 % of revenue hinges on UK-Canada-Ireland; any visa tightening or pricing shock could squeeze growth.
- Valuation looks fair and model asset-light, but high concentration and no fresh funds temper enthusiasm.
Steel Trade: India’s BIS Mandate Spurs Import Shock Amid Rising Global Protectionism
- Recent Impact: India’s BIS mandate has disrupted steel imports overnight, stranding shipments and pressuring MSMEs.
- Pricing: While prices have remained broadly stable so far, rising input tightness and seasonal factors suggest upward pressure is likely ahead.
- Global Trends: Around 25–35% of global steel trade is now under protectionist measures, reflecting a broader shift toward regionalization and defensive trade policies.
Event Driven: Torrent Acquires JB Chemicals ~ The Second-Largest Pharma Deal in Indian History
- Torrent Pharmaceuticals (TRP IN) is acquiring a controlling stake in J.B. Chemicals & Pharmaceuticals (JBCP IN) for INR 25,689 crore, marking the second-largest pharma deal in India’s history.
- The acquisition strengthens Torrent’s market share in India, expands its therapeutic presence, and opens entry into the growing CDMO sector, diversifying its business model.
- The merger is expected to drive revenue growth, improve margins, and provide operational synergies, with long-term gains in both domestic and international markets.
The Beat Ideas: Centrum Capital -Unlocking the Hidden Value from Unity Small Finance Bank
- Centrum Capital’s expansion into Unity Small Finance Bank and Modulus Alternatives marks a significant shift from a niche advisory firm to a diversified platform. This transformation opens new growth avenues.
- The move to digital banking with Unity SFB and the Modulus AIF enhances Centrum’s ability to capture broader market segments, offering greater revenue diversification and reducing reliance on volatile markets.
- The shift to digital-first banking and AIF repositions Centrum for long-term growth, making it a more resilient, multi-vertical financial player, though risks related to asset quality and capital needs remain.
India Coal Sector Q1 FY26: Private Miners Surge, CIL Stumbles
- CIL reports 8.5% drop in June output, while private and captive mines post double-digit growth
- Unusual monsoon, logistics bottlenecks, and subsidiary underperformance drag PSU volumes
- Unless execution improves in Q2 and beyond, outlook on CIL remains cautious amid structural market shifts.
Capillary Technologies India Ltd Pre-IPO Tearsheet
- Capillary Technologies India Ltd (CTIL) (0611334D IN) is looking to raise about US$240m in its upcoming India IPO. The bookrunners for the deal are JM Fin, IIFL, Nomura.
- CTIL provides AI-based, cloud-native SaaS products and solutions, primarily serving enterprise customers generating over ₹8 million in annual revenue from operations.
- As per the Zinnov Report, CTIL was the global leader in loyalty and engagement management by product count in FY25, and among few offering end-to-end loyalty solutions.
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