The Securities and Exchange Board of India (Sebi) on Thursday said that its modified regulations pertaining to passing of ordinary resolutions in case of all material related party transaction will come into immediate effect for listed companies.

In case of related party transactions, Sebi has now eased the rules for listed companies allowing them to secure a simple majority instead of a three-fourth majority of disinterested shareholders when voting on such transactions.

According to lawyers, this will dilute the undue power of disinterested shareholders in a related party transaction.

“This will strike the correct balance between interested and disinterested shareholders. While it will not allow interested shareholders to vote at all but at the same time it will only give simple majority right to disinterested shareholders thereby stopping them from blocking genuine related party transactions. These new regulations would make passing of related party transaction easier,” said Lalit Kumar, partner at law firm J Sagar Associates.

Earlier in July, the corporate affairs ministry has asked Sebi to align its guidelines for related party transactions with the amended Companies Act a move that did not go down well with some of the minority shareholders.

Sebi on Thursday also said that its new rules on classification of promoters as public shareholders will also come into effect immediately for listed firms, even as it gave 90 days to implement all the other provisions of the listing regulations.

We have an overweight rating on DLF with a March 2016 price target of R210. Our target is SOTP-based, valuing the dev co at 1x land cost and the rent co at 15x Ebitda.

Key upside risks include higher-than-expected pre-sales/launch activity, significant upward revisions to Cyber City rentals; and a sharp cut in policy rates.

While key downside risks are delay in the new launches and sustained weakness in pre-sales trends, an increase in debt levels, a material de-rating of overall macro fundamentals in India.

Asset sales should help reduce residential net debt. DLF’s residential business has a net debt of ~R7,000 crore and is currently running cash neutral given drag of old low margin book (sold at low prices).

Asset sales for the year (R2,600 crore) should enable the company to be largely cash neutral for the year. This as construction costs in the business will be elevated given planned 20msf deliveries of old low margin projects.

Once cash flows from its new projects start building up from F17 onwards, we think DLF will break into positive FCF zone. We note that DLF’s ongoing residential projects embed R15,000 crore of pre-tax FCF, more than enough to fully reduce the residential debt on a four-year view. In one of the largest residential PE transactions in India, DLF signed a JV agreement with govt Of Singapore which will enable GIC to invest in two of DLF’s residential projects in Delhi. GIC will invest R1,990 crore as part of this transaction. With this DLF has achieved 90% of its asset sales guidance for the year.

Currently, the UTI MF is ranked as the fifth largest player in the mutual fund space in the country in terms of average AUM. (PTI)

After having joined the Rs 1 trillion club of fund houses, the Unit Trust of India Mutual Fund (UTI MF) is now looking to cross the mark of Rs 1.1 trillion by the fiscal-end.

It was on July 4 that the fund house crossed the mark of Rs 1 trillion in terms of asset under management (AUM), which currently stands at Rs 1,03,800 crore.

It will depend on retail investors to achieve the new target. Currently, the UTI MF is ranked as the fifth largest player in the mutual fund space in the country in terms of average AUM.

“We have already crossed the Rs 1 trillion mark of average AUM as on July 4 and now we are all set to cross the mark of Rs 1.1 trillion by March-end,” UTI Asset Management Company Managing Director Leo Puri told PTI today.

“To achieve the newly set target of average AUM, our focus will be on retail investors,” he said.

Puri was speaking on the sidelines of the closing bell ringing ceremony for the UTI MF’s recently launched equity exchange traded fund (ETF), Sensex ETF, which was held at the Bombay Stock Exchange (BSE) this evening.

The fund house has already merged 14 of its products within the last three years and is planning to merge one more such fund during the current fiscal.

“We have already applied before Sebi for merger of one of our energy funds with the infrastructure fund and we are waiting for its approval,” he said.

Talking about the motive behind the launch of the two equity ETFs-Nifty and Sensex, he said that “Yes, we do expect Employees’ Provident Fund Organisation (EPFO) to invest into them. But I can’t tell you how and when will they invest into the equity funds of UTI MF.”

Even as the UTI MF is very much working on its plan to come up with an Initial public offering (IPO), it is still waiting for a nod from the government for the same.

“We will see the company’s IPO happening in a matter of time as we are already in talks with the governemnt on the issue and waiting for its nod,” he said.

The EPFO has already started putting in Rs 400 crore per month into the equity ETF of SBI MF and has plans to invest Rs 4,500 crore by the fiscal end.

Talking about the two equity ETFs, the new fund offer (NFO) for which had been launched on August 24 and closed on August 26, the UTI MF group President (Sales and Marketing) Suraj Kaeley said, “We have already collected Rs 16.5 crore from Nifty ETF and Rs 12.5 crore from Sensex ETF during the very NFO period itself and we have opened 4,500 folios under both the products so far.”

Talking about the industry, Kaeley said, “Entire ETF (including gold) is currently having an AUM of Rs 12,000 crore and is likely to cross the mark of Rs 50,000 crore within the next three years. When it comes to equity ETF, its current AUM is at Rs 6,000 crore and is likely to cross Rs 30,000 cr within the next three years.”

Shares of steel major SAIL on Thursday ended with nearly 5 per cent gains after the company said it will press ahead with its modernisation programme and augment capacity in the current financial year. (Photo: Reuters)

Shares of steel major SAIL on Thursday ended with nearly 5 per cent gains after the company said it will press ahead with its modernisation programme and augment capacity in the current financial year.

The stock ended the day 4.84 per cent higher at Rs 48.75 on BSE. Intra-day, it surged 6.45 per cent to Rs 49.50.

At the NSE, shares of the company gained 4.83 per cent to Rs 49.65.

The company’s market valuation rose by Rs 928.1 crore to Rs 20,134.10 crore.

In terms of volume, 7.93 lakh shares of the company changed hands at BSE and over 30 lakh shares were traded at the NSE during the day.

SAIL said on Wednesday that it will spend Rs 7,500 crore on modernisation and expansion programme in the current fiscal ending March 2016.

The public sector undertaking (PSU) also said it will seek shareholders nod to raise Rs 5,000 crore through securities to part finance the plans.

So far, the Maharatna company has invested over Rs 58,000 crore in its Rs 70,000 crore modernisation and expansion plan, which will augment the crude steel production capacity at its five steel plants to 23 million tonnes per annum (MTPA).

The company has taken up the massive programme of its plants as also for augmenting raw material supplies from its mines. The expansion programme has been decided to be funded through a mix of debt and equity, SAIL had said in a regulatory filing on Wednesday.

HSBC believes Emami shares can touch Rs 1,500. (Express Photo)

Share price of Emami jumped as much as 6.25 per cent on Thursday on reports that FTSE upgrades Emami to the midcap segment of the FTSE global equity index series coupled with HSBC on Monday initiated coverage of Emami Stocks with a “buy” rating.

At 12.24 pm, Emami was trading 3.43 per cent higher at Rs 1,259. It opened at Rs 1240 and had touched a high and low of Rs 1293.45 and Rs 1,240, respectively, in trade so far. Sensex was up 0.83 per cent at 25,664.

The share price of the company jumped 3.5 per cent at Rs 1217.30 on Wednesday.

HSBC believes Emami shares can touch Rs 1,500. Says Emami’s core brands Navratna, Zandu, Fair & Handsome and Boroplus dominate their market segments; growth story isn’t fully priced into the stock.
Adds Emami trades at 8 per cent discount to industry leader Hindustan Unilever.

According to Eikon data, out of 26 analysts covering the stock, 5 have a strong buy, 7 have a buy, 9 have a hold and 5 have a sell rating on the Emami stocks.

(With inputs from Reuters)