Inside the IPO Filing Process from DRHP to Listing Day

Soybean (Glycine max) is termed Golden Bean. The plant is classed as associate seed and is a vital international crop. The processed soybean is the largest supply of supermolecule feed and second-largest supply of edible fat within the world. The foremost portion of the worldwide and domestic crop is solvent-extracted with alkane to yield soy oil and procure Soymeal, which is widely employed in the animal feed trade.

Soybean has a very important place in the world's seed cultivation state of affairs, because of its high productivity, profitability and important contribution towards maintaining soil fertility. The crop additionally features an outstanding place as the world's most vital seed legume, that contributes 25% to the worldwide edible fat production, about 2/3rd of the world's protein concentrate for livestock feeding, and is a valuable ingredient in formulated feeds for poultry and fish.

About 85% of the world's soybeans are processed annually into soybean meal and oil. Of the oil fraction, 95% is consumed as edible oil; the rest is used for industrial products such as fatty acids, soaps and biodiesel.

Soybean seed is processed for Soymeal and Soy oil, both of these products are consumed throughout the country. A previously substantial part of Soymeal production gets exported but in the last two years exports reduced and domestic consumption increased.

India produces around 10 Mn tones of Soybean, while global production is around 340Mn tones. Among which the major producing countries are the USA, Brazil and Argentina whereas the major producing states are MP, Maharashtra and Rajasthan.

USES OF SOYBEAN:

• Processed Soybean is the largest source of protein feed and second-largest source of vegetable oil in the world. Soybean seed is processed for Soymeal and Soy oil, both of this product are consumed throughout the country.
• Soybean seed is processed for Soymeal and Soy oil, both of these products are consumed throughout the country.
• There are many other products which are manufactured from Soybean like Soy nutrila, Soy flour, Soy yogurt, Soy sauce, Soy milk, tofu etc

• Soybean oil is also used for industrial purposes in products like paints, plastics and cleaners and also used as biodiesel fuel for diesel engines that are being produced from the soybean oil by a simple process called transesterification.

FACTORS AFFECTING THE PRICE OF SOYBEAN:

• Weather condition especially during sowing and pod bearing condition.
• Demand for Soybean from Soybean processing industry.
• The demand of Soymeal from the poultry feed industry.
• Government policies: MSP, Import duty, stock limit, import and export duty on its derivatives.
• Demand-Supply and price scenario of other competitive oils i.e. palm oil.
• Price movement of Soybean in international exchange CBOT.
• International production of Soybean and also International prices of Soymeal and Soy oil.

SEASONALITY:

BENEFITS OF NCDEX SOYBEAN FUTURES:

• It acts as a benchmark for the futures contract of soybean.
• It helps in a robust delivery mechanism.
• It connects the entire value chain.
• Hedging and price risk management tool for the value chain.
• Efficient and transparent price discovery.

CONTRACT SPECIFICATIONS:

• Ticker symbol - SYBEANIDR

• Trading Unit - 5 MT

• Delivery Unit - 5 MT

• Maximum Order Size - 500 MT

• Tick Size - Re.2 (per QUINTAL)

• Hours of Trading- Mondays through Fridays: 9:00 A.M. to 5:00 P.M.

• Quantity Variation - +/- 2%

• Delivery Center - Indore, Akola, Latur (Maharashtra), Mandsaur (MP), Kota (Rajasthan)

• Delivery Logic - Compulsory Delivery

• Delivery Specification - Upon expiry of the contracts all the outstanding open positions shall result in compulsory delivery.

• Due date/ Expiry Date 20th day of the delivery month - If 20th happens to be a holiday, a Saturday, or a Sunday, then the expiry date (or due date) shall be the immediately preceding trading day of the Exchange, which is other than a Saturday.

रॉयटर्स सर्वे के मुताबिक, ओपेक के कच्चे तेल के उत्पादन में जनवरी महीने में प्रति दिन 160,000 बैरल प्रति दिन की वृद्धि हुई है क्योंकि ओपेक और गठबंधन 2021 के पहले महीने में उत्पादन में कटौती को कम कर रहा है। ओपेक के स्रोतों के अनुसार ओपेक का उत्पादन जनवरी में औसत 25.75 मिलियन बैरल प्रति दिन रहा, दिसंबर से 160,000 बैरल प्रति दिन और लगातार सातवें महीने में कार्टेल ने अपना उत्पादन बढ़ाया है।

जबकि उत्पादन में बढ़त पिछले महीने में अधिकांश लीबिया से है, जिसे ओपेक गठबंधन मे कटौती से छूट दी गई है। जनवरी में उत्पादन में वृद्धि आश्चर्यजनक नहीं है क्योकि ओपेक गठबंधन ने जनवरी में उत्पादन में 500,000 बैरल प्रति दिन जोड़ने का फैसला किया था।

पूरे समूह के लिए 500,000 बैरल प्रति दिन के कोटे में से, ओपेक की बढ़ी हुई उत्पादन की हिस्सेदारी लगभग 300,000 बैरल प्रति दिन है। इसलिए, जनवरी में उत्पादन की सबसे बड़ी वृद्धि क्रमशः ओपेक के नंबर एक और नंबर दो उत्पादकों, सऊदी अरब और इराक से हुई है, क्योंकि उनका उत्पादन मे हिस्सा अधिक है।

जनवरी में ओपेक के उत्पादन में तीसरा सबसे बड़ा इज़ाफा ईरान से आया है, जो लीबिया की तरह ओपेक गठबंधन की कटौती से मुक्त है। कच्चे तेल की कीमतों मे मांग कम होने की सम्भावना और उत्पादन अधिक होने से ऊपरी स्तरों पर दबाव है और नए कोवीड-19 वायरस महामारी को लंबे समय तक जारी रख सकता है, जिससे मांग घट सकती है।

तकनीकी विश्लेषण:

इस सप्ताह फ़रवरी वायदा कच्चे तेल की कीमतों मे ऊपरी स्तरों पर दबाव रहने की सम्भावना है। इसमें 4025 रुपय के ऊपरी स्तरों पर प्रतिरोध एवं 3650 रुपय के निचले स्तरों पर सपोर्ट है।

Introduction:

Bonds are one of the most essential financial instruments available to investors. They are popular for their stability and predictable returns, making them a key component in a balanced investment portfolio..

1. What Are Bonds?

Bonds are debt securities issued by various entities such as governments, municipalities, and corporations to raise capital. When you purchase a bond, you're essentially lending money to the issuer. In return, the issuer promises to pay you periodic interest (known as the coupon) and return the bond’s face value (or principal) when it matures.

Did you know The concept of bonds dates back to ancient Mesopotamia, where they were used to record debts and obligations. Fast forward to today, and bonds remain a cornerstone of modern finance!

2. Types of Bonds

Let's dive into the various types of bonds available in the market, with examples relevant to Indian investors:

a. Government Bonds

Government bonds are issued by national governments and are considered one of the safest investments. In India, these are known as Government Securities (G-Secs). They are backed by the government’s ability to tax its citizens, which minimizes the risk of default.

Example: The 10-year Government of India Bond is a common benchmark bond that many investors in India consider for long-term stability.

Did you know Did you know that India’s first-ever bond issue dates back to 1811? It was issued by the East India Company to fund its operations in the country.

b. Corporate Bonds

Corporate bonds are issued by companies to fund their operations or expansion. These bonds typically offer higher interest rates than government bonds due to the increased risk associated with the issuer's financial health.

Example: HDFC, a leading financial services company in India, frequently issues corporate bonds that offer attractive returns compared to government bonds.

c. Municipal Bonds

Municipal bonds are issued by state governments, cities, or other local government entities. In India, these bonds are not as prevalent as in some other countries, but they do exist. The interest from these bonds is often exempt from certain taxes, making them appealing to investors in higher tax brackets.

Example: Some Indian states have issued municipal bonds to fund infrastructure projects like the development of smart cities.

d. Zero-Coupon Bonds

Zero-coupon bonds do not pay periodic interest. Instead, they are issued at a discount to their face value, and the investor receives the full face value at maturity. This type of bond can be useful for long-term financial goals.

Example: The Reserve Bank of India has issued zero-coupon bonds in the past, which are sold at a deep discount and redeemed at face value upon maturity.

e. Convertible Bonds

Convertible bonds are hybrid securities that can be converted into a predetermined number of the issuing company’s shares. These bonds offer the potential for equity-like returns while providing the safety of a bond.

Example: Tata Motors has issued convertible bonds that can be converted into equity shares, offering investors both stability and potential for growth.

f. High-Yield Bonds (Junk Bonds)

High-yield bonds, also known as junk bonds, are bonds with a lower credit rating, which means they carry a higher risk of default. To compensate for this risk, they offer higher interest rates.

Example: Some smaller Indian companies, particularly in the infrastructure and real estate sectors, may issue high-yield bonds to attract investors willing to take on more risk for higher returns.

3. Key Features of Bonds

Understanding the key features of bonds is crucial for making informed investment decisions. Here are some important aspects to consider:

a. Face Value (Par Value)

The face value, or par value, is the amount the bondholder receives when the bond matures. In India, corporate bonds typically have a face value of ₹1,000.

b. Coupon Rate

The coupon rate is the interest rate the bond pays, usually expressed as an annual percentage of the face value. In India, interest payments on bonds are often made semi-annually.

Example: A corporate bond from Infosys might offer a coupon rate of 8%, meaning the investor would receive ₹80 per ₹1,000 bond each year.

c. Maturity Date

The maturity date is when the bond’s principal amount is repaid to the bondholder. Bonds can have short-term, medium-term, or long-term maturities, depending on the issuer's needs and the investor's preferences.

Example: A 5-year bond issued by Reliance Industries would return the principal amount after five years, along with the final interest payment.

Did you know The longest-maturity bond ever issued was a 100-year bond, sometimes referred to as a "century bond." In 2020, India’s largest steelmaker, Tata Steel, issued such a bond!

d. Yield

Yield represents the bond’s return on investment. It can vary based on factors like the bond’s price, coupon rate, and remaining time to maturity. Yield is an important measure for comparing the potential returns of different bonds.

e. Credit Rating

Bonds are rated by agencies like CRISIL, ICRA, and CARE in India, which assess the issuer’s creditworthiness. Higher ratings (like AAA) indicate lower risk, while lower ratings (like BB or lower) suggest higher risk.

Example: A bond issued by the State Bank of India (SBI) might have a AAA rating, indicating a very low risk of default.

Did you know India’s bond market was largely developed after the 1991 economic reforms, and today it’s one of the fastest-growing bond markets in Asia!

f. Callable Bonds

Callable bonds can be redeemed by the issuer before the maturity date, usually at a premium. This feature benefits the issuer if interest rates drop, allowing them to refinance at a lower cost.

Example: Some bonds issued by Indian corporations like ICICI Bank are callable, giving the issuer flexibility to manage their debt efficiently.

Conclusion

Bonds are a versatile investment option that can offer varying degrees of risk and return. By understanding the different types and features of bonds, Indian investors can make informed decisions that align with their financial goals, whether they're seeking safety, income, or growth potential.

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Stove Kraft was originally incorporated in 1999. They are primarily involved in the manufacture of kitchen appliances, equipment and utensils. Stove Kraft is a kitchen solution and an emerging home solutions brand. Further, it is one of the leading brands for kitchen appliances in India and is one of the dominant players for pressure cookers and a market leader in the sale of free-standing hobs and cooktops.

Stove Kraft is engaged in the manufacture and retail of a wide and diverse suite of kitchen solutions under its Pigeon and Gilma brands and proposes to commence manufacturing of kitchen solutions under the BLACK + DECKER brand, covering the entire range of value, semi-premium and premium kitchen solutions, respectively.

Its kitchen solutions comprise of cookware and cooking appliances across its brands, and its home solutions comprise various household utilities, including consumer lighting, which not only enables it to be a one-stop-shop for kitchen and home solutions but also offer products at different pricing points to meet diverse customer requirements and aspirations.

The company has a strong distribution network as under the "Pigeon" brand, it has 651 distributors in 27 states and 5 union territories and 12 distributors for exports and under the "Gilima" brand, it has 65 stores across 4 states and 28 cities.

It not just distribute its products in the Indian market but also exports them to countries like the USA, Mexico, Kenya, Qatar, Sri Lanka, Fiji, Bahrain, Kuwait, etc. Stove Kraft has manufacturing facilities at Bengaluru (Karnataka) and Baddi (Himachal Pradesh).

All Pigeon and Gilima branded appliances are manufactured at its Bengaluru unit and the Baddi facility focuses on the Oil Company Business (OCB) to manufacture products like LPG stoves, inner lid cookers, etc.

Products and Brands:

Stove Krafts products are sold under three brands, viz. Pigeon, Gilma and BLACK + DECKER to cater to the value, semi-premium and premium customer segments, respectively. Set out below is a brief overview of the class of products retailed under each of the brands:

Pigeon:

Pigeon, which is value for money brand, offers a wide array of products under various sub-categories. Set out below is an overview of the products currently offered by us under the Pigeon brand:

Some of the marquee innovative products, such as the Super Cooker, Infinity glass cooktops and Super Storm Advanced mixer grinder, are sold under the Pigeon brand. The Pigeon ‘super cooker’ is an innovative offering which provides the functionalities of straining, serving, induction cooking compatibility and non-stick, energy-efficient cooking in a single product.

Gilma:

Gilma brand, which focuses on the semi-premium customer segment, is sold exclusively through Gilma branded stores which are designed to offer the customer a modular kitchen experience. Currently, the Gilma portfolio comprises of chimneys, hobs and cooktops across price ranges and design offerings. We believe that our Gilma products combine premium design with effective performance, offered at a competitive price. While Gilma chimneys come built with higher suction power and a lifetime warranty, the hobs offer features such as anti-rust stainless steel body, energy efficiency and one-touch auto-ignition. Similarly, Gilma LPG stoves are designed keeping in mind thermal efficiency, durability and portability. Gilma LPG stoves use toughened glass and brass burners and come with a two-year warranty.

BLACK + DECKER

BLACK + DECKER is a renowned name internationally in the field of, inter alia, kitchen appliances. Presently, we offer the following products under the BLACK + DECKER brand, aimed at the premium segment of customers:

IPO Details:

Subscription Dates25 – 28 January 2021Price BandINR 384 – INR 385Fresh issueINR 95 croresOffer For SaleINR 317.63 croresTotal IPO sizeINR 412.63Minimum bid (lot size)38 SharesFace Value INR 10 per shareRetail Allocation10%Listing OnNSE, BSE

Strengths of the Company:

• A one-stop-shop for a well-recognized, award-winning portfolio of kitchen solutions brands with a diverse range of products across consumer preference
• Widespread, well-connected distribution network with a presence across multiple retail channels and a dedicated after-sales network
• Strong manufacturing capability with efficient backward integration;
• Consistent focus on quality and innovation
• Professional management with a successful track record and extensive experience in the kitchen solutions industry, and a young and dynamic workforce
• Strong track record and financial stability

IPO Objective:

• To make the repayment or prepayment payment of the company's borrowings fully or partially
• To meet general corporate purposes.

Financial Performance:

Financial performance (in INR crore)FY2018FY2019FY2020H1 FY2021Revenue534.6642.6672.9329.5Expenses547.1641.4669.4300.7Net income-11.70.92.930.1Margin (%)-2.20.10.49.1

IPO Tentative Time Table

21 Jan 2020: Price Band announced

22 Jan 2020: Anchor List

25 Jan 2021: Offer Opens

28 Jan 2021: Offer Closes

3 Feb 2021: Finalization of Basis of Allotment

3 Feb 2021: Unblocking of ASBA“

4 Dec 2020: Credit to Demat Accounts

5 Feb 2021: Listing on NSE & BSE

Risks:

• Expenses on raw materials increase or the cost of production rises for any other reason, the company will not be able to break even.
• There are unresolved legal issues with regard to certain land parcels which fall inside the factory space.
• There are several outstanding cases — both criminal and civil — against the company and the Stove Kraft Limited owner, Rajendra Gandhi.

Outlook:

Eyeing the brand reorganization and their focus on the innovation of products to meet the needs of the customer we expect that the fundamental of the company will boost up. The company's revenue from operations stood at Rs 328.8 crore in the April-September 2020 period, up from 4.2 percent from the year earlier. Its net profit jumped to Rs 28.8 crore in the same period, against Rs 4.4 crore a year ago. Stove Kraft IPO is priced at 34.5x PE on a trailing basis while the PE of the industry is 46x. We assign a "Subscribe" rating only for listing gain.

Regional economic cooperation is considered to be an approach of moving towards a world economy. in the up to date situation, regional economic cooperation is taken into account because it is the means for enhancing economic development and providing economic security at intervals within a particular region.

Regionalism is being channeled in addressing problems like trade, food and energy security, global climate change, connectivity and also the happening of health epidemics. The regional commissions are instrumental in building strategic partnerships with regional and sub-regional organizations. This joint work has helped bring universal values and norms to the regions.

Of course, the international organization regional commissions are central to the work. Every day, they promote regional cooperation and integration and extend their experience for socioeconomic development. They’re stimulating innovative ideas, together with on finance for development and different means of implementation.

They’re spearheading international organization regional efforts to support their member countries within the implementation of the 2030 Agenda together, by promoting integration, policy coherence, reinforced knowledge and peer learning.

What Benefits will Regional Economic Cooperation Provide?

1. Regional economic cooperation will alter stronger transport and trade connectivity through coordinated physical investments and harmonization of policies, rules, and procedures. Economic corridors and worth chains traversing sovereign borders are often promoted.  
2. Regional Economic Cooperation allows participating countries to fully use underutilized economic potential in terms of human, natural and technological resources.
3. Regional Economic Cooperation helps in industrial diversification and in reducing economic dependence, provides scope for participating countries to expand existing industrial activities and additionally to begin new ones.
4. Regional cooperation will promote economic and monetary stability through countries of Central Asia adopting synchronous fiscal, monetary, and rate policies to forestall monetary contagion, addressing shared general risks in banking systems, implementing common regulation and superior standards, and sharing lessons and knowledge.
5. Regional cooperation is often a force for job creation. New standards for technical education that promotes school and student exchanges, in specialized subject areas and introducing new productivity-enhancing technologies at the regional level for cost-effectiveness. New employment and entrepreneurship opportunities will take place.
6. Regional Economic Cooperation allows participating countries to take advantage of the potential complementarities and additionally to determine strategic alliance between enterprises with a motive to enhance their fight in the international market.
7. Most significantly, regional cooperation will facilitate building enough economic stakes within the region that promote peace and prosperity and well diminish the threat of aggression and war. This might pave the approach for elevating regional economic cooperation to a replacement pinnacle.

Guidelines:

There are certain guidelines for promoting Regional Economic Cooperation

1. Cooperation ought to support equality, equity and mutual profit-taking absolutely under consideration the economic social inequality moreover because of the variations within the level of development among countries within the region.
2. Cooperation ought to involve commitment towards the common goals on the part of all collaborating countries with equal respect for each other.
3. Cooperation ought to be supporting consultation, deliberation, and accord on all economic and different connected problems.
4. Cooperation ought to complement and turn on existing bilateral and different reasonable arrangements among member countries.
5. Cooperation ought to support modalities of economic openness and reciprocity and as per principles of the multilateral trading system established.

Drawbacks:

The drawbacks concerned in making regional agreements embody the following:

• In essence, regional agreements have fashioned new trade barriers with countries outside of the trading alliance. Member countries might trade additional with one another than with nonmember nations. This might mean raised trade with a less economical or costlier producer as a result of its membership. During this sense, weaker corporations are often protected unknowingly with the alliance agreement acting as an import barrier.
• Countries might move production to cheaper labor markets in member countries. Similarly, staff might move to realize access to higher jobs and wages. Sudden shifts employed will tax the resources of member countries.
• Nations might realize that they need to administer up additional of their political and economic rights.

History shows that Economic recovery and favorable regional dynamics in Central Asia add any momentum to the current era of regional economic cooperation. They tend to seize the chance provided by these fortuitous developments and deliver lasting peace, progress, and prosperity for countries and other people within the region and on the far side.

Regional integration will expand markets and input sources, higher allocating resources across the region, therefore a fast economic process. It can even improve risk-sharing. However, there also are drawback risks, starting from potential contagion to growing financial gain difference and polarization.

Some Important Regional Organizations are as follows:

1. Association of South-East Nations (ASEAN)
2. Bay of Bengal Initiative for Multi-Sectoral Technical and Economic Cooperation (BIMSTEC)
3. South Asian Association for Regional Cooperation (SAARC)
4. Asia-Pacific Economic Cooperation (APEC)
5. Indian Ocean Rim Association (IORA)

Home First Finance Corporation was founded in 2010 based in Mumbai. The company is an affordable housing finance company. The company offers home loans to lower and middle class to buy homes. They also offer loans against property, developer finance to buy commercial properties as well.

The company has a diverse lead generation source channel including connectors, contractors, architects, affordable housing developers, and others. As on Sep 30, 2019, the business has a strong branch network of 65 branches across 60 districts in 11 different states and a union territory in India with a key presence in markets such as Maharashtra, Karnataka, Tamil Nadu, and Gujarat.

It offers quick and transparent loan transactions through its mobile app. As on Sep 30, 2019, it has serviced a total of 37,086 active loans. Its Gross Loan Assets have grown at a CAGR of 69.8% between FY2017 and FY2019 and increased from INR8,473.16 million as of 31 March 2017 to INR31,133.76 million as of 30 September 2019.

Strengths of the Company:

1) Technology-driven affordable housing company.

2) Strong penetration in the largest housing finance market.

3) Diversified lead source channel.

4) Sound fundamentals.

IPO Objective:

1) To augment a company's capital base to meet future capital requirements.

2) Listing benefits.

IPO Details:

Home First Finance IPO details

Subscription Dates

‍21 – 25 January 2021

‍Price Band

‍INR517 – 518 per share

‍Fresh issue

‍INR265 crore

‍Offer For Sale

‍INR888.72 crore

‍Total IPO size

‍INR1,153.72 crore

‍Minimum bid (lot size)

‍28 shares

‍Face Value

‍INR 2 per share

‍Retail Allocation

‍35%

‍Listing On

‍NSE, BSE

Tentative Timetable

19th Jan – Announcement of Price Band

20th Jan – Anchor Investors Allotment

21st Jan – Offer Opens

25th Jan – Offer Closes

29th Jan – Finalization of Basis of Allotment

01st Feb – Unblocking of ASBA Accounts

02nd Feb – Credit of Equity Shares to Depository Accounts

03rd Feb – Commencement of Trading

Financial Performance:

Home First Finance’s financial performance (in INR crore)

FY2018FY2019FY2020H1 FY2021Revenue134.2270.9419.7243.2Expenses110.0205.7312.4172.8Net income16.045.179.152.8Net margin (%)11.916.618.821.7

Outlook:

AUM of the company Stands around Rs 3700 cr while the net worth of the company is Rs. 988 cr.  For the six months ended September 30, 2020 and the financial year 2020, it sanctioned 2,591 and 15,591 loans on account of leads generated through 887 and 2,553 connectors, respectively. At the upper price band of Rs 518, the issue is priced at a 4.1x P/BV ratio. The RoE and RoA of HFFC is 11% and 2.94% respectively.

Revenue of the company is increasing YoY with a strong strong increase of 150% in total assets. The profit of HFFC increased by 70% CAGR since 2018 with an increase in profit margins. Eying the growth in real estate, NBFC-Housing companies are expected to have a strong boost. We assign a "Subscribe" rating for listing gain and long term.