Posts in category All News
Sundram Fasteners Limited – Annual General Meeting Updates (14-09-2015)
Kesoram Industries shares gain, JK Tyres falls post tyre plant deal (14-09-2015)
![Tyre industry in india](http://images.financialexpress.com/2015/05/tyres-l.jpg)
Shares of Kesoram Indutries and JK Tyres are in focus on Monday after companies informed stock exchanges that JK Tyre & Industries has signed a binding term sheet with Kesoram Industries to acquire its tyre manufacturing unit at Haridwar. (Reuters)
Shares of Kesoram Indutries and JK Tyres are in focus on Monday after companies informed stock exchanges that JK Tyre & Industries has signed a binding term sheet with Kesoram Industries to acquire its tyre manufacturing unit at Haridwar (Cavendish Industries Ltd). The Haridwar unit manufactures truck and bus radial as well as two and three wheeler tyres.
At 11.16 am, Kesoram Industries shares were trading 5 per cent higher at Rs 107.45 apiece. The share price of the company opened at Rs 113.40 and had touched a high and low of Rs 116.50 and Rs 106.40, in trade so far. On the other hand, share price of JK Tyre & Industries was trading 1.34 per cent down at Rs 107 at the same time.
Kesoram Industries shares jumped as much as 13 per cent in trade so far on Monday.
JK Tyre along with its associate or group companies would acquire 100 per cent of Cavendish at an enterprise value not exceeding Rs 2,200 crore. JK Tyre will hold the largest shareholding block and will have substantial management control of Cavendish with an option to place up to 55 per cent with its associates or group companies. The acquisition would be funded by combination of debt and internal accruals raised by JKT and other JK Group entities.
According to JK Tyres, its financial exposure is expected to be to the order of Rs 450 crore. The transaction is expected to be completed over next few months.
According to Angel Broking, the deal appears to be expensive, as the tyre segment is currently loss making for Kesoram.
Market analysts said, “Kesoram has struggled with margins for the business, however, MRF, Apollo Tyres, CEAT, JK Tyre enjoy better margins. The deal is beneficial for Kesoram, it will take loss making business out of the company and will help in reduce debt. Kesoram will be left with loss-making Orissa tyre plant; might see cement assets transferred to other Birla companies in the group.”
According to Eikon data, Kesoram has a net debt of Rs 4,832 crore in 2014.
(With inputs from Reuters)
Jaitley exhorts US companies to invest more in infra (14-09-2015)
Avanti Feeds soars 2.7%; to set up power consumption wind mill (14-09-2015)
Syngene International IPO – Views invited (14-09-2015)
The major force driving Syngene would be increased R&D spending by global pharmaceutical companies. Also companies would focus more on decreasing costs and hence would partner companies like Syngene. By reading RHP the major risk i could ascertain was with regards to clients of Syngene. Since it is kind of service related work one needs to monitor what are the developments taking place with the major clients of Syngene for eg. Bristol Myers. M&A activities in pharmaceutical companies can lead to alteration of these contracts which could have a material impact on earnings. Also any change in policy by these companies can only be known by studying the client companies in detail
Emami says Kesh King buy to push FY16 growth to 25-26% (14-09-2015)
![Emami says Kesh King buy to push FY16 growth to 25-26% Emami says Kesh King buy to push FY16 growth to 25-26%](http://www.moneycontrol.com/news_image_files/2015/h/harsha_agarwal_emami_200.jpg)
M&M forays into experiential ecommerce sector; trades flat (14-09-2015)
![](http://10.0.1.104:85/_media/iifl/img/article/2015-01/20/full/1421756255-2154.jpg)
Syngene International IPO – Views invited (14-09-2015)
Hi Rupesh,
Rgdg. your queries......
(1) Since Syngene has only recently came out with its IPO so risk factors are very well documented in RHP -- you can refer that.
If you ask me then the biggest risk factor is not meeting the delivery schedules of customers is the biggest risk factor to me. NMEs are very sensitive contracts where if you falter on even one thing then customer suffers alot -- even more than you --so margin of error is minimal in such contracts. This ofcourse I am talking about commercial manufacturing......having said these, it is because of this factor that inspections and checks are most stringent while catering to this segment and unless customer is working with you since last many years (in many cases decade) and is fully satisfied of your capability and integrity that he will enter into contract with you.
Second biggest risk factor is any mismanagement during CAPEX i.e., any delay or something, especially Mangalore plant once work starts there next year.
(2) Name of the molecules as well as many customers might not be talked in detail because of NDAs signed by the company because of confidentiality issues involved in the sector. If you have researched PIIND before then you must very well know this.
As far as what company is actually doing, as said before, RHP is filed only before two months and there is no point in discussing entire thing again here. Still from RHP if you don't understand anything then here that can be explained lucidly.
Feel free to get back in case of any further query.
Rgds.