September 21, 2024
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Stock Market

Parent Companies who are coming up with IPOs of their subsidiaries

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Stock Market

Parent Companies who are coming up with IPOs of their subsidiaries

India’s business landscape is buzzing with excitement. Big companies are preparing to showcase their star players in the stock market. There’s something for everyone, from electric cars to green energy, from loans to insurance. These upcoming IPOs aren’t just about raising money. They’re about shaping India’s economic future.

We’re seeing traditional giants and new-age startups alike step into the spotlight. Each IPO tells a unique story of growth and ambition. As these companies gear up to go public, investors are watching closely. Let’s dive into the world of these soon-to-be market debutants and see what they have in store for us.

Upcoming IPOs Under Parent Company

NTPC – NTPC Green Energy

NTPC, India’s largest power generation company, is taking a significant step towards green energy with its subsidiary, NTPC Green Energy. The company is planning a massive IPO worth ₹10,000 crore, which is set to be the largest initial share sale by a public sector company in India.

This move underscores NTPC’s commitment to transitioning towards cleaner energy sources. The IPO proceeds are earmarked for funding ongoing and future projects across the solar, green hydrogen, and green ammonia sectors. This strategic shift comes at a time when global attention is focused on sustainable energy solutions.

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NTPC Green Energy’s IPO aims to raise capital and position the company as a leader in India’s renewable energy landscape. The substantial interest from investors, including a notable offer from Petronas, highlights the potential value of this green energy venture. By leveraging its parent company’s expertise and resources, NTPC Green Energy is poised to play a crucial role in India’s transition to a more sustainable energy future.

HDFC Bank – HDB Financial Services

HDFC Bank, one of India’s leading private sector banks, is preparing to unlock value from its non-banking finance arm, HDB Financial Services. The company is eyeing a significant IPO, aiming to raise around ₹10,000 crore (approximately $1.2 billion). This move involves HDFC Bank diluting its stake in HDB Financial Services by nearly 10%.

The NBFC is in the final stages of appointing lead managers for the offering, signaling that preparations are well underway. This IPO is not just about raising capital; it’s a strategic move to establish HDB Financial Services as a standalone entity in the public market.

The offering is expected to attract significant investor interest, given HDFC Bank’s strong reputation in the financial sector. For HDB Financial Services, going public could provide greater visibility, access to capital markets, and potentially accelerate its growth in the competitive NBFC space. This IPO also aligns with the broader trend of banks separating their various business verticals to unlock shareholder value and create more focused entities.

Canara Bank – Canara Robecco AMC

Canara Bank is set to make waves in the asset management sector with the planned IPO of its mutual fund arm, Canara Robeco Mutual Fund. The bank intends to sell a 13% stake through this public offering, subject to approvals from regulatory bodies like the Reserve Bank of India and the finance ministry.

This move is significant as it would make Canara Robeco the fifth listed asset management company in India, joining the ranks of Aditya Birla Sun Life AMC, HDFC Asset Management, Nippon Life India Asset Management, and UTI Asset Management.

Canara Robeco Mutual Fund, a joint venture between Canara Bank and the Robeco Group since 2007, has shown impressive growth with assets under management worth ₹839.3 billion as of December 2023. This represents a 1.6% share of the mutual fund industry’s total AUM in India.

The IPO could provide Canara Robeco with increased visibility, access to capital, and potentially accelerate its growth in the competitive mutual fund landscape. For investors, this offering presents an opportunity to participate in India’s growing asset management sector.

Reliance Industries – Reliance Jio

Reliance Industries telecommunications juggernaut Reliance Jio, is gearing up for a monumental IPO slated for 2025. This offering is expected to be one of the largest in India’s corporate history, with a potential valuation exceeding ₹9.3 trillion ($112 billion). Currently, Reliance Industries holds a 66.3% stake in Jio Platforms, the holding company of Reliance Jio, with the remaining shares distributed among tech giants like Facebook, Google, and various private equity investors.

The IPO strategy likely involves an offer for sale by minority shareholders to meet regulatory requirements for public listing. This move is not just about raising capital; it’s a strategic step to unlock value for existing shareholders and potentially reshape the Indian telecom landscape.

The sheer size of the proposed IPO presents unique challenges, particularly in mobilizing retail investors, as a significant portion of the offering is reserved for this segment. Jio’s market debut could have far-reaching implications for India’s digital economy and telecom sector, potentially attracting global attention and investment.

Muthoot Finance – Belstar Microfinance

Muthoot Finance is set to make waves with its microfinance subsidiary, Belstar Microfinance. This company has been a key player in India’s financial inclusion efforts since 1988. Belstar focuses on providing small loans to those often overlooked by traditional banks, especially women entrepreneurs in rural and semi-urban areas.

They’re now gearing up for a significant IPO, aiming to raise ₹1,300 crore. The offering includes ₹1,000 crore in new shares and ₹300 crore from existing shareholders. This move could be a game-changer for Belstar, giving them the funds to expand their reach and impact. They offer a wide range of micro-loans for businesses, farming, education, and personal needs.

By going public, Belstar isn’t just raising money – they’re putting microfinance in the spotlight. This IPO could open doors for more people to invest in India’s grassroots economic growth. It’s a bold step that shows how microfinance is evolving from a niche service to a mainstream financial product. For investors, it’s a chance to be part of India’s financial inclusion story while potentially reaping returns from a growing sector.

Manappuram Finance – Asirvad Micro Finance

Manappuram Finance is pushing its microfinance arm, Asirvad Micro Finance, into the limelight with an upcoming IPO. Asirvad has gotten the green light from SEBI to raise ₹1,500 crore through a fresh issue of shares. What’s interesting is there’s no offer for sale component – it’s all about growth capital. Asirvad’s journey is pretty impressive.

Starting with just two branches in Tamil Nadu back in 2008, they’ve grown to cover 22 states and 4 Union Territories. Today, they’ve got 1,684 branches across 450 districts, serving 3.25 million active borrowers. It’s not just about microfinance either – they’ve branched out into gold loans and MSME lending too.

This IPO could be a big boost for Asirvad, giving them the funds to reach even more underserved communities. They’ve brought in some heavy hitters to manage the offering, including JM Financial and Kotak Mahindra Capital. For investors, this IPO offers a chance to tap into India’s growing microfinance sector. It’s a bet on financial inclusion and the potential of India’s vast unbanked population.

Bank of Baroda – India First Life Insurance

Bank of Baroda is getting ready to showcase its insurance venture, IndiaFirst Life Insurance, in the public market. This Mumbai-based insurer has been making waves as one of the fastest-growing private life insurers in India. Bank of Baroda holds a controlling 65% stake, with Warburg Pincus and Union Bank of India holding the rest. They’ve got big plans for an IPO, looking to raise about ₹5 billion through new shares and an offer for sale of 141.3 million shares from current owners.

While they got the nod from SEBI in March 2023, they’re playing it smart – waiting for the right market conditions before taking the plunge. The latest buzz suggests they might wait up to 18 months, aiming to hit ₹300 billion in assets under management and achieve double-digit growth first.

This cautious approach shows they’re not just after a quick buck – they’re building for the long haul. For investors, this upcoming IPO could be a chance to get in on India’s growing insurance market, backed by a major public sector bank.