Arvind's Newsletter

1.September IPO Surge: 47 companies raise over ₹16,000 crore; 61% trade above issue price

India's IPO market is booming, with 47 companies raising ₹16,152 crore in September. Retail investors are driving demand, especially in the SME segment, where offerings are often oversubscribed.

Once dominated by institutions, India's primary market is now experiencing a surge in retail participation, driven by the potential for higher returns and easier access to the financial markets.

2.Changing scenario: Debt-free Tata Sons has firepower for newer biz

Tata Sons is a debt-free company on a net basis for the first time in 18 years.

The Tata group’s main holding and promoter company reported a gross debt of Rs 363.2 crore at the end of March this year, down sharply from Rs 22,176 crore at the end of FY23.

Against this, the company reported cash and equivalents worth Rs 3,042 crore at the end of FY24, up from Rs 1,534 crore a year ago. This translated into a negative net debt of Rs 2,679.2 crore. At its peak, Tata Sons had an outstanding debt of Rs 31,603 crore at the end of March 2020 and a net debt-to-equity ratio of 0.56.

A combination of a debt-free balance sheet and a steadily growing dividend income from group listed companies such as Tata Consultancy Services, Tata Motors, Titan, and Tata Consumer provides financial firepower to Tata Sons to scale up investment in new ventures or step up dividend payouts. Last time when Tata Sons was debt-free on a net basis in FY06, it was followed by a string of large cross-border acquisitions, which transformed the group.

3.BlackRock in talks with Jio Financial for private credit joint venture

BlackRock, the world's biggest asset manager, is in talks with Mukesh Ambani-led Reliance Group firm Jio Financial Services to set up a private credit venture, Bloomberg News reported on Wednesday, citing people familiar with the matter.

The two companies will form a 50-50 joint venture to lend to businesses ranging from large companies to startups, if talks materialise, the report said, adding that a final decision on the venture was yet to be made.

4.Local Capability Centres India Inc Too Riding GCC Wave

Foreign companies are not the only ones setting up global capability centres (GCCs) in India to provide centralised support to their businesses. Large Indian corporations are also building such facilities, often to beef up their technology capabilities.

Reliance Industries, Adani Group, Dr Reddy’s Laboratories (DRL) and Bank of Baroda are among Indian entities that have set up such centres locally in the past two to four years.

Indian firms are estimated to have set up around 50 GCCs in the last couple of years in sectors like telecom, financial services and automotive.

5.There has been a wave of Big Tech investments in nuclear power -the latest being Amazon, following Google and Microsoft.
Amazon buys stake in nuclear energy developer in push to power data centres

Amazon is buying a stake in US nuclear developer X-energy, as part of a collaboration with the company aimed at deploying small modular reactors to provide low-carbon electricity to power its data centres.

X-energy said on Wednesday that Amazon had agreed to anchor a $500 mn fundraising, which would help the company finance the development and licensing of its new generation of SMRs, which it said are more efficient than large-scale nuclear reactors.

Ken Griffin, founder and chief executive of Citadel, Ares Management Corporation, private equity firm NGP and the University of Michigan also participated in X-energy’s fundraising.

X-energy did not disclose the size of the stake Amazon had bought, but said the technology group would take two seats on the company’s board of directors.

6.Twenty years on from its discovery, graphene is coming of age. 

Graphene, an atom-thick honeycomb of carbon atoms, was hailed as a wonder material when it was first made, in England in 2004. It conducts heat and electricity brilliantly while being stronger than steel — “expectations were very, very high,” its Nobel-winning discoverer told Science. But it was hard to incorporate in mass-produced devices, applications were overhyped, and interest waned in the 2010s.

In the last few years, though, following the classic hype cycle, companies are developing new uses for graphene — uses as diverse as coating for ships’ hulls, heat diffusers in cell phones, and brain electrodes — and the industry, currently worth around $150 million a year, could increase in value tenfold in the next decade.

7.China is leading a new “age of electricity,” the International Energy Agency said, as fossil fuel demand looks set to peak by decade-end. 

The global energy watchdog’s annual report said clean energy is being added at “an unprecedented rate,” faster than the growth in energy demand and enough to push fossil fuels into decline. 

China accounted for 60% of new renewable energy in 2023, it said, and its solar generation alone is on course to exceed the US’ total electricity demand by the early 2030s. The IEA noted, though, that uncertainty remained high due to wars involving oil-producing Russia and the Middle East.

 India wants to challenge China’s clean-energy dominance: New Delhi is planning a $109 billion investment in the electricity grid to incorporate new renewable sources.

8. Researchers discovered a tomb underneath the ruins of Petra. 

Petra, in Jordan, is an entire city carved 2,000 years ago from the walls of a desert canyon: It is a UNESCO World Heritage Site and has been named one of the new seven wonders of the world. 

The archeologists used ground-penetrating radar to look beneath the floor of one large building at the centre of the ancient city, and detected underground cavities. Excavation revealed a tomb with 12 bodies— a hugely exciting find, because very little is known about the Nabataean civilisation that made the city. “The burials, their goods, and the human remains can all be expected to help fill the gaps in our knowledge of how Petra came to be,” one archaeologist said.