Namaste! Aaj ka news roundup, Newswala style!

MARKETS

Markets: The Nifty slipped from its recent consolidation, reflecting growing market pessimism, with TFII-triggered selling pressure continuing to impact the domestic market. While most sectors saw losses, IT stocks rose on hopes of higher US IT spending, as concerns about inflation, food prices, and a weakening INR loomed over RBI's monetary policy.

TOP STORIES

Coca-Cola’s Bottling Attracts Goldman and Jubilant

What Happened

Goldman Sachs is set to join forces with the Bhartia family of Jubilant Group to acquire a 40% stake in Hindustan Coca-Cola Beverages (HCCB), Coca-Cola's bottling unit in India. 

• The deal, currently in advanced negotiations, could see Goldman Sachs pumping in ₹3,000-3,500 crore via convertible preference shares. 

This move aligns with Coca-Cola’s plan to replicate PepsiCo’s success with Varun Beverages, aiming for an asset-light strategy that unlocks value through a future listing. 

Why It Matters

This transaction could reshape India’s beverage industry and bring strategic benefits to both Coca-Cola and its investors. By establishing a stake in HCCB, the Bhartias and Goldman Sachs are not only betting on the growing beverage market in India but also setting the stage for a public listing in the next 2-3 years, which would allow Goldman to exit at a profit. 

The financial structure is notably designed to provide Goldman a capped 20% internal rate of return (IRR) with some downside protection. Coca-Cola’s planned initial public offering (IPO) of HCCB is expected to follow a "waterfall mechanism" for prioritizing debt repayments, a structure aimed at maximizing returns for all stakeholders. 

What’s next?

The Bhartias plan to match Goldman’s investment through a mix of equity and debt financing sourced from mutual funds. The investment structure will place the special purpose vehicle (SPV) between the mutual fund debt and the Bhartias' equity stake.

Meanwhile, HCCB is moving forward with a ₹1.5 billion capital expenditure plan, which includes new facilities in Gujarat and Madhya Pradesh. This expansion aligns with the company’s strategy to grow aggressively in emerging markets, capitalizing on its scale in smaller cities and towns.

PAISON KA KHEL

BSE’s Q2 profits triple, revenue doubles

BSE’s latest quarterly results are turning heads! The stock exchange reported a massive 193% year-on-year surge in net profit, hitting ₹346 crore for Q2, up from ₹118 crore last year. Revenue doubled, reaching ₹819 crore compared to ₹367 crore. 

• The average daily equity turnover rose to ₹9,768 crore, while equity derivatives spiked to ₹8,203 crore. 

Zepto seeks $250 million from HNIs at flat valuation

Zepto, the quick commerce startup, is aiming to raise $250 million from high-net-worth individuals (HNIs) and wealth firms such as Motilal Oswal, IIFL and InCred, at a flat valuation of $5 billion. If successful, this will mark Zepto's third fundraising round in six months. 

The Mumbai-based company, which became a unicorn last year, is preparing for a public market listing in 2025. Despite raising $340 million in August and $665 million in a previous round, Zepto is working to balance its capital structure ahead of the IPO.

TOP STORIES

RIL’s Largest Clean Energy Investment

What happened?

Reliance Industries Ltd (RIL) is making a historic ₹65,000 crore investment in Andhra Pradesh to set up 500 compressed biogas (CBG) plants over the next five years. This marks RIL's largest renewable energy investment outside Gujarat. The project will involve an estimated ₹130 crore investment per plant, built on government wasteland across the state. 

• The plan, which was finalized during talks between Anant Ambani and Andhra Pradesh IT Minister Nara Lokesh, aims to create 250,000 jobs, both direct and indirect. 

Why it matters

This venture is a critical part of Andhra Pradesh's strategy to attract investments in clean energy and create job opportunities. The state’s new integrated clean energy policy offers substantial incentives for biofuel projects, including a 20% capital subsidy and full reimbursement of state GST and electricity duty for five years.

RIL’s investment aligns with these incentives and is expected to provide a boost to the state's economy. The economic ripple effect of the biogas plants is estimated at ₹57,650 crore over 25 years, factoring in the SGST collection, electricity duty and taxes generated by employment.

Additionally, RIL plans to work with local farmers to cultivate special crops, which is projected to increase their income by ₹30,000 per acre annually.

Zoom out

The 500 biogas plants will not only provide a cleaner, renewable energy source but also create a vast number of jobs in rural areas. The ₹30,000 annual increase in farmer income per acre will boost livelihoods. The state is expected to gain ₹57,650 crore in tax and employment-related revenues over the next 25 years. RIL’s investment focuses on both clean energy and rural development.

GLOBAL NAZARA

Saudi Arabia needs over 100000 new homes each year

Saudi Arabia’s housing market is on fire, with a need for 115,000 new homes annually until 2030, according to Knight Frank’s report. Over the next six years, this amounts to 825,000 homes! The demand is mainly driven by young Saudis, with 45% of the population under 20, eager to own homes. 

Over 800,000 contracts have been signed and mortgage finance has increased five-fold since 2016.

China plans to slash homebuying taxes 

China is considering slashing homebuying taxes as part of a fiscal stimulus to revive its struggling housing market. Proposed cuts could reduce deed taxes in cities like Beijing and Shanghai to as low as 1%, down from the current 3%. 

This move aims to eliminate distinctions between ordinary and luxury homes, making upgrades more affordable. With a focus on boosting property sales, this plan follows previous measures, including mortgage cost cuts and relaxed buying rules. 

TOP STORIES

Amul Milk to Hit European Shelves by Month-End

What Happened

Amul, India's largest dairy brand, is making a major move into Europe. By the end of this month, Amul will launch its fresh milk products in Europe, thanks to a new partnership with a milk cooperative in Spain. The Spanish cooperative will handle the milk production, while Amul will take care of marketing and branding. 

Why It Matters

Amul’s collaboration with a Spanish cooperative will allow the company to avoid the complexities of directly exporting milk to the European Union, where high duties and strict regulations can be challenging. The local partnership will ensure smoother operations and help Amul comply with the EU’s certification requirements.

Following its successful entry into the US market earlier this year, Amul will now expand into Europe. With rising demand for quality dairy, this move will position Amul to tap into new growth opportunities through a reliable local tie-up.

Not just Milk!

Amul is starting its European journey with fresh milk, but the plan doesn’t stop there. The brand aims to introduce more popular Indian dairy products like ghee, dahi and paneer to the European market. With a daily collection of over 310 lakh liters of milk and a turnover of ₹ 80,000 crore, Amul is set to make a global impact. 

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