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28th September 2021
Good Morning! 

Do you remember the days when Class 10 and 12 board mark sheet certificates were used as official documents everywhere and so you really had to take care of that 1 piece of paper? (We in fact still have our mark sheet)
Those days are on their way out now because the CBSE is going to go fully paperless!  And they're going to be using blockchain technology to do this! 
  MARKETS
 

SENSEX

60,077.88

+ 0.05%

NIFTY

17,855.10

+ 0.01%

US$

73.84

+ 0.20%

GOLD

46,191

+ 0.43%

10-YR

6.21%

+ 2.8 bps

OIL

5,598

+ 2.40%

*As of market close

  • Markets: Nifty September Futures went above 18,000 for the first time ever yesterday, and that too right at the open. But it seems traders were just waiting for that happen as they stepped up the selling pressure and sent the index back down to close virtually flat for the day.

Corporate

Proxy Problems
Thumbs down

The management of the newly listed Zomato Limited just had its first real shareholder test as a public company.

A majority of institutional investors in Zomato have voted against the company's proposal on the Employee Stock Option Plan (ESOP).

This is kind of important because many believe institutional investors are the 'smart money' with better insights into companies they invest in.

This plan was actually first approved by shareholders before the IPO, in April 2021. But since the company is now public, the matter was brought forward to be voted on again.

Zomato has never made a profit, and because of the expense of granting additional ESOPs to founder Deepinder Goyal and other employees, the company saw losses widen compared to the previous quarter.

In the quarter ended Jun'21, Zomato recorded a loss of Rs 360 crores, vs Rs 131 crores in the previous quarter. At the same time, employee expenses due to increased ESOPs went up to Rs 391 crores from Rs 191 crores earlier.

Overall the proposal was still passed because institutional investors only hold ~16% stake in Zomato, and other shareholders did not seem to think this was a big deal.

Even though issuing shares does not take cash out of the company, it is still an expense, and one Warren Buffet has always warned against. Read this for more of his 'gyaan' on the topic.

Energy

Slippery Issues
Oil on face

First up is the disinvestment of Bharat Petroleum (BPCL)

The chairman of the company has said that the gov intends to complete the strategic stake sale before the end of March 2022, i.e., within the current financial year.

It was earlier expected to be comfortably completed by then, but in September, credit rating agency Fitch Ratings said there could be delays because it's a big deal and there are issues with valuation and bidder consortiums.

Vedanta, Apollo Global, and I Squared capital are the three parties that have been most interested in this deal.

The complications are because this is a ‘strategic stake sale’, where the gov is selling a controlling stake of ~53%, and at the current stock price this is worth over Rs 50k crores.

Also, the acquirer might have to make an open offer to buy out the 2 other large shareholders of BPCL - Petronet LNG and Indraprastha Gas Ltd. 
They’ve already asked SEBI for permission to skip this step, but if they don't get it, it would cost the acquirer an extra Rs 19,000 crores.


LPG Subsidy

You must have seen a lot of news articles over the past year or so about increasing LPG cylinder prices. They’ve risen ~Rs 300 since May 2020. From Rs 580 to Rs 880 per cylinder in Delhi.

That’s because when the pandemic hit, international gas prices crashed. So the gov used this as an opportunity to save some money and removed the subsidy. They managed to save ~Rs 20k crores by doing this.

However, prices have risen sharply since and people are really starting to feel the pinch. But the subsidy has not been reinstated yet.

Now Business Standard reports that the Oil Ministry is re-evaluating its options to figure out a balance between a cylinder price that people will be able to afford and the amount of subsidy that can be given.

One of the options also being considered is to limit subsidies only to Pradhan Mantri Ujjwala Yojana (PMUY) beneficiaries.

Tech

Tech Snippets
Money gun
 

Swiggy Looking To Raise

Swiggy is gearing up to raise some more money!! Entrackr believes they want to raise up to $800 million at a valuation close to $10 billion.

If they get the money they're looking for, at the valuation they're hoping, it will imply a ~90% jump in their valuation from the last time they raised money.

It seems Zomato going public to major fanfare must have given them some major FOMO and also a ton of encouragement. The market has responded quite well to Zomato's listing and it is now valued at ~$14 billion.

Looking at the current environment, we will be surprised if Swiggy doesn't end up getting the money they're hoping for.


Cashback Time

We're not sure whether you noticed the new Rupee symbol in your WhatsApp chat with other Indian numbers??
WhatsApp has been trying to make push 'WhatsApp Pay', but considering people are pretty set with other UPI apps like GPay, PhonePe and Paytm, their efforts haven't yielded much so far.

Now they are thinking of going the way other UPI players went to drive adoption - Cashbacks.

But the amount isn't that enticing - as per one report it will be up to Rs 10. 

Come on now Zuck, share some more of that green stuff. These are rookie numbers, you got to pump those numbers up.

Practo Launches 50 Surgery Experience Centres

Practo seems to have lost a lot of the hype that once surrounded it. You don't see the company being talked about as much anymore. But that doesn't mean they aren't making any moves.

A quick refresher - they started way back in 2008 as B2B software for doctors to manage their clinics.
They then used this to launch a marketplace where consumers could search for doctors and book appointments.
They've since added a whole host of things like online consultations, medicine delivery, diagnostic test bookings etc.

And now they've launched something quite ambitious - they are going to be offering surgeries with Practo Care Surgery.

They are launching 50 Practo Care Experience Centers in major Indian metros.

They will be offering more than 50 surgical procedures across three specialities - General Surgery, ENT, as well as Urology.

It is good to see a startup concentrating on the secondary healthcare market in India, that was much needed.
When do you think Practo decides to go public?

On a Lighter Note

Campus Ambassador Program


If you are a college student do check out our campus ambassador program. 
For more deets check this out.

If you have more time ...

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