Coffee Day Enterprises on Wednesday fixed the price band at Rs 316-328 per share for its initial public offering (IPO). The IPO opens on October 14 and closes October 16, through which the company aims to raise Rs 1,150 crore – the biggest IPO since the public issue of Bharti Infratel in December 2012.

The Bengaluru-based company will dilute about 17.55% stake on post-offer basis that will value the company at Rs 6,750 crore. The company aims to raise R 340 crore by allotting shares to anchor investors on October 13.

Kotak Mahindra Capital Company, Citigroup Global Markets India and Morgan Stanley India Company, Axis Capital, Edelweiss Financial Services Limited and YES Bank are the book running lead managers for the issue.

The company intends to use its proceeds to pay back existing debts worth Rs 632.8 crore, while rest of the amount would be used for general corporate purposes. Out of the total shares on offer, 50% are reserved for qualified institutional bidders (QIBs), while 35% are for retail investors.

Coffee Day Enterprises is the parent company of the Coffee Day Group and operates coffee business through a subsidiary, Coffee Day Global and its subsidiaries. The company also has presence in real estate sector through a subsidiary Sical Logistics. It also owns 16.75% equity holding in Information Technology company Mindtree.
Coffee Day is the 16th IPO to hit the market in CY15, with 15 companies having raised close to Rs 6,500 from primary markets so far.

According to data from the Association of Mutual Funds in India (Amfi), investors withdrew a net Rs 77,142 crore in MF schemes last month. (Thinkstock)

Investors pulled out over Rs 77,000 crore from mutual fund schemes in September, making it the highest outflow in six months, with liquid and money markets contributing the most to the outflow.

This comes on top of net outflow of about Rs 46,750 crore from mutual fund products in August.

According to data from the Association of Mutual Funds in India (Amfi), investors withdrew a net Rs 77,142 crore in MF schemes last month.

This was the highest outflow in a single month since March, when the industry had seen a withdrawal to the tune of Rs 1,09,897 crore.

Industry insiders said outflow from Mutual Fund (MF) schemes last month was mainly on account of huge redemptions in liquid and money market funds.

However, investors continued to maintained bullish stance on the equity schemes.

Liquid or money market fund category witnessed Rs 60,861 crore being pulled out last month, income funds too saw net outflows of Rs 26,717 crore. However, equity and equity linked schemes saw an inflow of Rs 5,444 crore.

Liquid and money market funds invest mainly in money market instruments like commercial papers, treasury bills, term deposits and certificate of deposits. These funds have a lower maturity period and do not have any lock-in period.

With the latest outflow, the net inflow in the schemes stands at Rs 80,895 lakh crore in the April-September period of the current fiscal, 2015-16.

The asset base of the country’s 44 fund houses fell to Rs 11.87 lakh crore last month from Rs 12.55 lakh crore in August.

HMT today surged nearly 18 per cent after the company signed a pact with a German firm Fraunhofer for technology upgradation. (Photo: PTI)

Shares of engineering firm HMT today surged nearly 18 per cent after the company signed a pact with a German firm Fraunhofer for technology upgradation.

The stock of the state-run firm zoomed 17.60 per cent to Rs 58.80 at BSE.

On NSE, it climbed 17.71 per cent to Rs 58.80.

Fraunhofer is Europe’s largest application-oriented research organisation.

“HMT has signed an MoU with Fraunhofer, pertaining to technology upgradation for developing latest technology machines by our subsidiary HMT Machine Tools Ltd.

“The MoU was signed in the presence of Prime Minister Narendra Modi and German Chancellor Angela Merkel,” HMT had said in a BSE filing yesterday.

In the past 5 trading sessions, the BSE Sensex gained 5.14 per cent at 26932.88 on October 6. The benchmark index was at 25,616.84 on September 28. NSE Nifty gained 4.6 per cent during the same period. ( Express photo)

The BSE Sensex jumped 1,316 points in the past five trading sessions on the back of positive surprise from RBI, which announced a repo rate reduction by 50 basis points to 6.75 per cent, continuing the front loading of rate cuts. It also derived confidence from better fiscal deficit numbers for first five month of FY16.

In the past 5 trading sessions, the BSE Sensex gained 5.14 per cent at 26932.88 on October 6. The benchmark index was at 25,616.84 on September 28. NSE Nifty gained 4.6 per cent during the same period.

ICICI Securities in a research note said, “A rate cut by RBI supported market sentiments. Going ahead, earnings would be the key driver for market movement. From a sectoral perspective, we are positive on auto, cement and capital goods (cyclical recovery in earnings aided by lower input costs and declining interest rates will provide strong operating and financial leverage). We also have a positive outlook on the IT and pharma space (given their quality of earnings) with a negative bias on metals, infrastructure and real estate.”

On October 6, Sensex was trading around 85 points up in the late morning trade. Below are five stocks on which market experts are looking bullish in the present market scenario.

Bajaj Finance
Recommended By: JM Financial
Why Buy: After a strong 52 per cent growth in asset under management (AUM) over the past five years, JM Financial believes Bajaj Finance is setting a base for the next leg of sustainable and profitable growth by setting up wholly owned housing finance subsidiary. It has received an approval from NHB for the housing finance subsidiary. The brokerage house believe Bajaj Finance will focus on lower ticket size mortgages (ticket size of `3-4mn) through its subsidiary. On the back of this HFC subsidiary and continued strength in core business, JM Financial estimate 3-year AUM and earnings CAGR of 26 per cent and 24 per cent respectively. JM Financial has ‘buy’ rating on Bajaj Finance with target price of Rs 5,700. On October 6, Bajaj Finance was at Rs 5,156.

Inox Wind
Recommended By: Nomura
Why Buy: In the past one month, the share price of Inox Wind gained 1.10 per cent to Rs 367.20 on October 6. Sensex gained 8.19 per cent during the same period. The Japanese brokerage firm believes the share price of Inox Wind can touch Rs 497. According to Nomura, Inox Wind is well placed with India’s renewable sector at an inflection point owing to reinstated incentives for the sector and the government’s push for 75 GW of wind capacity by 2022. Inox Wind’s revenue and EBITDA will grow at CAGR of 34 per cent and 37 per cent, respectively, between FY 15-18. The company will also have positive free cash flows by FY16.

For the quarter ended June 2015, the company posted net profit of Rs 50.50 crore, up 115.08 per cent, against Rs 23.48 crore in the corresponding quarter a year ago.

Inox Wind Ltd is one of India’s leading wind power solutions providers with manufacturing plants near Ahmadabad (Gujarat) for Blades & Towers and at Una (Himachal Pradesh) for Hubs & Nacelles.

Ashiana Housing
Recommended By: Religare Capital Markets
Why Buy: Ashiana Housing plans to deliver nine projects across its major markets in 2015-16. This should lead to a surge in revenue booked upon project completion. Further, the on-time delivery of its first projects in the cities of Neemrana and Halol should help the company establish its brand there. Its reputation stands out in the real estate space. Ashiana Housing is a real estate developer with a focus on housing.

In the past one year, the share price of Ashiana Housing jumped 13.13 per cent to Rs 180.45 on October 6. Sensex gained 2.52 per cent during the same period.

Shriram Transport Finance (STFC)
Recommended by: IIFL
Why Buy: STFC has decided to merge the equipment financing subsidiary with itself. At present, the sole focus is on working out recoveries from the defaulted customers and the efforts are translating into encouraging collections. Management intends to resume asset under management growth from end 2015 but with a revamped strategy. The construction equipment industry has started to show positive signs as the prices of used equipments have improved. A pick-up in infra/industrial construction activity will aid growth and non-preforming loans. STFC is trading at historical mean valuation of 2.2x 1-year rolling forward P/ABV. On FY18 adjusted book value, the stock valuation is at undemanding 1.8x considering the anticipated strong recovery in growth and profitability. At the start of an upcycle, if an inherently robust and profitable franchise is available at mid-cycle valuation then it’s a sound case to own it. On October 6, the share price of STFC was at Rs 954.40.

Voltas
Recommended By: Motilal Oswal
Why Buy: In a 5-star-rated air conditioner, which weighs 60 kg, 24 kg of copper and 5 kg of aluminum are used. These metals, which constitute almost 50 per cent of the weight of the air conditioner, have seen sharp price declines over the last few quarters. Lower raw material prices should offset the impact of discounts on margins. Despite lower volumes, Voltas maintained its margins in the first quarter of FY16.

The brokerage house is bullish on Voltas, however it cut Voltas earnings estimates by 4 per cent for FY16 and by 3 per cent for FY17. Voltas trades 23x FY16E and 17x FY17E adjusted EPS. Motilal Oswal maintains ‘buy’ rating on Voltas stock with target price of Rs 350 (Rs 360 earlier).

There are multiple triggers for the stock, which include positive impact of the Seventh Pay Commission hikes, improving margins in the Projects business, and structural uptrend in the air conditioner market. On October 6, Voltas was at Rs 280.75.

(Disclaimer: The stocks are recommended by the respective brokerage houses and not a recommendation from Financial Express online)

Brokerage firm Motilal Oswal said that gold loan penetration levels remain low and the addressable market is very large so niche expertise and single product focus will be growth enablers for Muthoot Finance. (Photo: PTI)

Muthoot Finance shares jumped as much as 8 per cent in the morning trade on Wednesday after Motilal Oswal initiated coverage with ‘buy’ rating with a target price of Rs 234 per share.

At 10.28 am, Muthoot Finance’s shares were trading 6.70 per cent up at Rs 174.40 on BSE. On NSE, the scrip was trading 6.26 per cent up at Rs 174.05.

Brokerage firm Motilal Oswal said that gold loan penetration levels remain low and the addressable market is very large so niche expertise and single product focus will be growth enablers for Muthoot Finance.

It further added that current valuations of 6.9x FY17 P/E and 1x FY17 BV are attractive.

With Reuters inputs