ETMarkets Morning Podcast: Byju’s set to be India’s most valued startup

Ujjivan shareholders reject Samit Ghosh as MD & CEO
Dalal Street traders go into May F&O series with bullish view
Reliance Retail becomes India’s fourth $100b company
Baring puts Hexaware on sale six months after taking it private

Hi there. Welcome to ETMarkets Morning, the show about money, business and markets. I am Sandeep Singh.

Let’s start with a quick glance on the state of the markets.

Dalal Street looked headed for a selloff on Friday, or at least that’s what Nifty futures trading on the Singapore Exchange seemed to be signalling. SGX Nifty futures were down some 190 points early in the day. Asian markets fluctuated in early trade. Wall Street indices rallied overnight, and the S&P500 closed at a record high fueled by gains in Facebook following its strong earnings report. The yield on 10-year US Treasuries advanced two basis points to 1.65%. The dollar looks steady; crude oil traded just below $65 a barrel level, Copper topped $10,000 a tonne for the first time since 2011, while gold dipped 0.3% to $1,767.10 an ounce.

That said, here’s what else is making news.

Mukesh Ambani’s Reliance Retail which sells everything from fresh foods to high-definition television sets costing thousands of dollars, has become the fourth Indian company to be valued at more than $100 billion. Unlisted shares of Reliance Retail are currently trading between Rs 1,500 and Rs 1,550 a share, more than trebling in value since January last year after the company tweaked mandatory share-swap ratios and began stake sales to global private equity funds.

Edtech major Byju’s is set to be the most valued startup in India, toppling SoftBank- and Alibaba-backed Paytm, which is valued at $16 billion. Byju’s is in advanced stages of talks to raise another $150-200 million from UBS Group, after which it is expected to be valued at around $16.5 billion. The fund raise was on top of the $1 billion funding it is currently closing from a clutch of new and existing investors at a valuation of over $15 billion. Byju’s had raised $1 billion capital last year.

Bajaj Auto’s strategy to premiumise locally and simultaneously gain share in export markets seems to be working. Analysts say this may turn the stock a sectoral outperformer. March quarter financial performance at Bajaj Auto suggests the company has managed to neutralise the impact of surging raw material prices to a large extent. Ebitda dropped 60 bps YoY to 17.7%, which was in line with the consensus analysts’ forecast.

Baring Private Equity Asia has decided to sell Hexaware Technologies, just six months after taking the mid-tier IT services firm private. The Hong Kong-based buyout fund has initiated the process by mandating investment banks Barclays and JP Morgan to find buyers at a valuation of Rs 18,500-22,200 crore, ET reported quoting multiple people aware of the development.

Indian companies with US dollar borrowings are increasing their hedges as they expect the rupee to depreciate in the coming months. Rising yields overseas and foreign investors’ belief that Indian assets are overvalued may lead to a flight of capital, putting pressure on the domestic unit. The rising Covid cases, too, have cast a shadow on India Inc’s earnings outlook denting FIIs’ confidence.

And lastly, some good news, traders carried forward bullish bets to the May derivatives series on expiry of April contracts on Thursday enthused by a recent spate of strong corporate earnings and on expectation that the country will tide over the second Covid-19 wave crisis. But, the extent of rollover was lower than the past three months due to uncertainty as to whether the market will be able to sustain its recent gains. Rollover in Nifty futures stood at 66% versus the three-month average of 79%. Market-wide rollover stood at 82% as against the three-month average of 91%.

NOW Before I go, here is a look at some of the stocks buzzing this morning…

Rahul Bajaj has resigned from his position of non-executive director and chairman at Bajaj Auto. He will be replaced by Niraj Bajaj, non-executive director of the company, with effect from May 1, 2021

FMCG bellwether Hindustan Unilever posted a strong March quarter performance with the low base effect helping record exceptional growth in net sales and net profit of 35% and 41%, respectively.

Shareholders of Ujjivan Financial Services have voted against the appointment of founder Samit Ghosh as MD & CEO in the latest instance of increased shareholder activism.

ICICI Bank is eyeing a large share of the potential Rs 31 lakh crore market for payments and settlements to more than 20 million small, big, offline and online businesses

Do also check out over two dozen stock recommendations for today’s trade from top analysts on ETMarkets.com.

That’s it for now. Stay put with us for all the market news through the day. Happy investing!