circuit breaker_27th august_2012

August 27, 2012 INVESTOCRAFT CIRCUIT

Movements in Equity Markets

Indian Markets:

Indian Markets were closed on Monday on account of Eid. The markets managed to pull out weekly gains for the 4th consecutive week on pumping by FIIs and improvement in global risk appetite. The Nifty surpassed 5400 but could not maintain the technically important level. Next week's important data to look forward to would be Q1 GDP numbers, F&O expiry and parliament proceedings.

The BSE Sensex was up 0.52% Friday, 24th August 2012

The NSE Nifty was up 0.38%Friday, 24th August 2012.

Sectoral Indices in the red were Power, Banking, Oil and Gas, Capital Goods and Realty.

Asian Markets:

It wasn't a good week for Asian Indices with the 2 major Asian Indices viz. HangSeng and Nikkei ending in the red.

The Hang Seng was down 1.2% The Nikkei was down 1%

INVESTOCRAFT CIRCUIT BREAKER


Indian Markets were closed on Monday on account of Eid. The markets managed to pull out weekly gains for the 4th consecutive week on pumping by FIIs and improvement in global risk appetite. The Nifty surpassed 5400 but could not maintain the technically important level. Next week's important data to look forward to would be Q1 GDP numbers, F&O expiry and parliament proceedings.

Sensex was up 0.52% W-o-W to end at 17783.21 points as on August 2012

NSE Nifty was up 0.38% W-o-W to end at 5386.70 points as on 2012.

Sectoral Indices in the red were Power, Banking, Oil and Gas, Capital Goods

It wasn't a good week for Asian Indices with the 2 major Asian Indices viz. HangSeng and Nikkei ending in the red.

Hang Seng was down 1.2% W-o-W as on Friday, 24th August 2012Nikkei was down 1% W-o-W as on Friday, 24th August 2012

BREAKER


Indian Markets were closed on Monday on account of Eid. The markets managed to pull out weekly gains for the 4th consecutive week on pumping of money by FIIs and improvement in global risk appetite. The Nifty surpassed 5400 but could not maintain the technically important level. Next week's important data to look forward to would be Q1 GDP numbers, F&O expiry and parliament proceedings.

W to end at 17783.21 points as on

W to end at 5386.70 points as on

Sectoral Indices in the red were Power, Banking, Oil and Gas, Capital Goods

It wasn't a good week for Asian Indices with the 2 major Asian Indices viz. Hang-

August 2012W as on Friday, 24th August 2012

August 27, 2012 INVESTOCRAFT CIRCUIT BREAKER

US Markets:

U.S Markets broke their string of six consecutive weekly gains and ended lower as weakness in the global economy hit investor sentiment. The S&P 500 Index hit a four-year high on Tuesday—coming within 9.5% of its all-time high in October 2007—before suffering its biggest drop in nearly a month on Thursday

The Dow was down 1.6% W-o-W as on Friday, 24th August 2012. The Nasdaq Composite was down 0.8% W-o-W as on Friday, 24th

August 2012.

Outlook for the week ahead:

The markets may remain range bound for the following reasons:

1. The stand-off between UPA – BJP over the Coalgate scam2. The Euro zone pressure on Greece to pass reforms demanded by

international creditors3. The talks of Indian government with temporary power suppliers

such as Aggreko will shed a different light on the power sector


FII & DII Data

FII wereNet Buyers of 958.76 crores DII were Net Sellers of Rs. 889.48 crores

Commodities

Brent Crude was down 0.09%and closed at $113.6/barrel

Mon Tue Wed Thur Fri

DII 0 -141.64 -230.14 -161.1 -356.6

FII (Debt) 0.00 245.1 -191.1 44.6 243.90

FII (Equity) 0.00 212.2 123.9 396.6 226.06

-500.00-400.00-300.00-200.00-100.00

0.00100.00200.00300.00400.00500.00600.00

Rs (C

rore

s)

FII & DII Data

DII

FII (Debt)

FII (Equity)

-1.50%

-1.00%

-0.50%

0.00%

0.50%

1.00%

1.50%

2.00%

Mon Tues Wed Thurs Fri

Crude Oil

Gold

USD/INR

August 27, 2012 INVESTOCRAFT CIRCUIT

Gold was up 2.40%phenomenon.

The Rupee gained 0.14%

Currency Movements

INVESTOCRAFT CIRCUIT BREAKER

Gold was up 2.40% to close at Rs 30000 due to the flight to safety

The Rupee gained 0.14% to the dollar

Currency Movements

LIBOR Data

BREAKER

to close at Rs 30000 due to the flight to safety


Other Important Indicators

Based on the Consumer Price Index (CPI), the inflation for June was revised downwards to 9.93% from the provisional estimate of 10.02%, as per the government data release.

Vegetable prices recorded the maximum spurt, up 27.33%, followed by edible oils -17.37% and pulses and its products - 12.49% in July, year-on-year basis.

Prices of egg, fish and meat shot up 11.11%, while non-alcoholic beverages became costlier 9.26%. The headline inflation as measured by the Wholesale Price Index (WPI) also declined to 6.87% in July as the rate of price rise of the food articles category eased a little, although pressure remained on potato, pulses and rice as well as manufactured items.

G-Sec Data & Yields


PE Deals for the weekFIDELITY GROWTH PARTNERS INVEST IN ABSOLUTDATA

Sector: Services

Business of Fidelity Growth Partners:

It is an India-focused PE arm of Fidelity Worldwide Investment, focused on cross-sector growth capital investing. FGPI seeks to invest in high-quality, high-growth companies in India across a broad range of sectors with typical investment sizes ranging from $10 Mn to $50 Mn.

Business of AbsolutData:

It is a provider of data analytics and research services to global organisations which in turn help to drive sales and increase profits for its customers. It specializes in big data, high end business analytics, predictive modelling, reporting and data management services.

Funding:

Fidelity Growth Partners India has committed to invest $20Mn in AbsolutData. As a part of this transaction, director of FGPI, KabirNarang, will join AbsolutData’s board.

Rationale:

The company is planning to use the funds to scale up global delivery footprint to meet the growing demand for advanced and big data analytics of the company.

INDIA INFOLINE MAY BUY STAKE IN NMCE

Sector:Banking/Financial Services

Business of National Multi-Commodity Exchange of India:

NMCE is the first de-mutualised electronic multi-commodity exchange of India located at Ahmedabad. It was granted the National status on a permanent basis by the GOI and is operational since 26th November 2002.


Business of India Infoline:

It is India's premiere Share Market & Financial News and Services Portal which provides the latest news about the stock market, NSE/BSE, SENSEX news and other business & financial news.

STANCHART PE INVESTS IN INOXCVA

Sector: Engineering

Business of Standard Chartered PE:

It is the private equity section of the Standard Chartered Bank aimed at providing a professional shareholding partnership for mid- to late-stage companies across a wide range of industries that require equity funding for expansion or to finance changes of ownership, such as acquisitions or management buy-outs.

Business of INOXCVA:

INOX India is part of the INOX Group. It has interest in diverse businesses including Industrial Gases, Refrigerant Gases, Fluoro Chemicals, PTFE, Renewable Energy, Cryogenic Equipment and Entertainment, and manufactures cryogenic liquid storage, pressure pumping equipments and transport tanks.

Funding:

Standard Chartered PE has invested $45Mn in INOXCVA. Yes Bank advised INOX for this transaction.

Rationale:

The funds will be used for INOXCVA’s organic expansion plans and potential acquisitions.

ACTIS INVESTS IN TPG BACKED AGS TRANSACT

Sector:Technology

Business of AGS Transact Technologies Limited:


It is an ATM outsourcing and payments company and offers technology-based solutions for banking, retail, petroleum and postal sectors. It operates in four business segments - sale, installation, maintenance and running of ATMs for bank.

Business of Actis PE:

It is a private equity firm investing exclusively in Africa, Asia and Latin America.

Funding:

Actis PE has invested Rs 220Cr in AGS Transact.

Rationale:

The funds raised will be used for ATM outsourcing expansion by AGS on behalf of banks and support roll-outs under the recent PSU contract of AGS in Himachal Pradesh, Haryana and Chandigarh.

GTI CAPITAL INVESTS IN BRATTLE FOODS, WEBKLIPPER

Sector: Agro/Food & Beverage

Business of Brattle Foods:

Brattle and its subsidiaries are engaged in the business of contract manufacturing of food products and providing logistics solutions, including cold and ambient temperature storage and transport.

Business of Webklipper Technologies Private Limited:

It builds software relating to conducting targeted surveys, targeted chats, notifications and obtaining feedback from visitors to websites. It also operatesWebEngage.

Funding:

GTI Capital’s invested an undisclosed amount in both Brattle foods and Webklipper.

Rationale:

Brattle's will be using the funds to expand its facilities, while Webklipper would be utilizing the funds as working capital and in the general expansion of its businesses.


KAMDHENU TO RAISE FUNDS FOR EXPANSION

Sector:Basic Industries

Business of KamdhenuIspat:

It is mainly into manufacturing of TMT bars and structural steels for use in the construction sector,and had also forayed into the paints business. It sells paints under brand ‘Colour Dreamz’ and offers a complete range of decorative paint products.

Funding:

It is planning to raise Rs.100Cr for its paint division and is in talks with PE firms.

Rationale:

The funds raised will be used for setting up an alkyd resin plant to reduce reliance on external sources for raw material procurement and meeting working capital needs.

SAAB – PIPAVAV ENTER INTO A STRATEGIC PARTNERSHIP

Sector: Defence

Business of SAAB:

It serves the global market of governments, authorities and corporations with products, services and solutions ranging from military defence to civil security. Its most important markets today are Europe, South Africa, Australia and the US.

Business of Pipavav :

Pipavav Defence and Offshore Engineering Company Limited is one of the major Indian private sector companies in the naval sector.

Funding:

SAAB has signed a MOU for a strategic investment in Pipavav and they have also signed a Technical Partnership Agreement(TPA). The MOU involves an investment by Saab of around MSEK 250.

Rationale:

These agreements are part of Saab's strategy to increase its presence in an important and large market and offer business possibilities for several parts of the organisation.


NASPER, TIGER GLOBAL INVEST IN FLIPKART

Sector:Technology

Business of Flipkart:

Flipkart is an Indian e-commerce company focused on online sales of books, electronic goods and a variety of other products.

Business of Nasper :

Nasper is a South African is a multinational media company with principal operations in in internet platforms (focussing on commerce, communities, content, communication and games), pay-television and the provision of related technologies and print media (including publishing, distribution and printing of magazines, newspapers and books).

Business of Tiger Global:

Tiger Global Management, LLC is a privately owned investment manager. The firm manages hedge and private equity funds. It invests in the public and private equity markets across the globe primarily the US, China, India, Southeast Asia, Latin America, and Eastern Europe. The firm also invests in fixed income markets of United States and hedge funds.

Funding:

Flipkart Online Services has raised $150 Mn investment led by Naspers and by existing investor Tiger Global. Accel Partners has also backed Flipkart to raise funds.

Rationale:

The funding has been aimed at improving the ongoing condition of ecommerce and seeing a bright future for Flipkart in near future.

L&T TO RAISE FUNDS THROUGH EQUITY PARTNERSHIP

Sector: Infrastructure

Business of L&T:

Larsen & Toubro Limited (L&T) is a technology, engineering, construction and manufacturing company. It is one of the largest and most respected companies in India's private sector. The company's businesses are supported by a wide marketing


and distribution network, and have established a reputation for strong customer support.

Funding:

This june, it was planning to raise $400-$500 Mn from private investment sources like long-term infrastructure-sector-focused PE investors, sovereign funds or global pension funds for it's infra arm-L&T Infrastructure Development Projects. Currently no information is available about the amount of funds it is planning to raise.

Rationale:

Through the funds raised, L&T is planning to reduce the portfolio size of the company and generate funds which could be used as equity in new projects.

RELIANCE LIFE INSURANCE PLANS TO SELL STAKE TO BANKS

Sector:Banking/Financial Services

Business of Reliance Life Insurance:

Reliance Life Insurance is a Reliance Capital Company and is part of Reliance Group. It offers you products that fulfill your savings and protection needs.

Funding:

Reliance Life Insurance is looking to sell 5% stake in the company to banks.

Rationale:

It wants to raise funds for expanding business in the bancassurance channel. It aims at a single partner of 'critical size' and its target is to maintain the relationship between the principal and agent with the bank.

L&T TO RAISE FUNDS THROUGH EQUITY PARTNERSHIP

Sector:Retail/Leisure/Travel/Textile

Business of L&T:

Spykar Lifestyle, founded by Prasad Pabrekar in 1992, manufactures jeans, T shirts and other casual wear and accessories for men and women. It has outlets in India, the United Kingdom, and Australia.


Business of Avigo Capital:

AvigoCapital, manages a Growth Capital & buyout SME Fund in India. Avigo seeks equity investments in pre-dominantly growth stage companies, across sectors offering compelling competitive advantages and significant growth potential.

Funding:

Avigo Capital is planning to sell its 60% stake in Spykar Lifestyle. Buyout fund Riverside and three European fashion retailers are interested to acquire the stake.

Venture CapitalCLASSLE RAISES FUND FROM CHENNAI ANGELS

Sector: Learning

Business of Chennai Angels:

Chennai Angels is a network of angel investors in Chennai which was started by likeminded people who were interested in funding and mentoring early companies. It has more than 15 investors and contributors.

Business of Classle:

Private Limited was started by Vaidya Nathan, an alumnus of IIT-Madras. It is a Social Learning Network; a network with focus on Learning and education. Classle built its platform using open-source technologies, wherein students and learners interact with their peers, teachers, professors and professionals. The modules, features and content can be accessed and delivered offline, as well as through the Internet and mobile technology. The website is a social learning platform with more than 45,000 users across over 1,400 engineering colleges.

Funding:

Classle raised $500,000 from Chennai Angels as a first step toward raising up to $5 million as growth capital in about a year.

Recent Deal by Investor:

Recently, Chennai Angels invested R2.5 Cr in ProKlean Technologies Private Limited for minority stake. It also funded Metroplots.com which provides property analysis, site visits, home loans, and property booking services.


ACCEL PARTNERS INVESTS IN BOOKMYSHOW

Sector: Technology

Business of Accel Partners:

Accel Partners is a global venture and growth equity firm. Accel funds companies from inception through the growth stage. Over the last three decades, Accel has helped entrepreneurs build over 300 successful companies, many of which have defined their categories, including Facebook, Groupon, GetJar,etc.

Business of Big Tree Entertainment:

Established in 1999, BigTree Entertainment is an entertainment ticketing company. Besides ticket booking, Bigtree is also involved in software sales and support, ticketing services, box office tracking and analysis. The company through its website www.BookMyShow.com, facilitates ticket bookings for movies, concerts and live events. The website has strong presence in over 10 cities across India and a single number for phone bookings through an automated speech recognition system.

Funding:

Accel Partners has invested R100Cr in BigTree Entertainment Private Limited for minority stake in the company. The company plans to use the funds raised to expand into the tier-II and III markets and further grow its non-movie ticketing business. Avendus Capital Pvt. Ltd is the advisor of the deal.

Recent Deal by investor:

Accel Partners recently invested in Mind Edutainment which develops and provides solutions to improve social and emotional thinking skills among school-going children. Earlier in August, Accel Partner invested $5 Mn in Universal Collectabillia, a celebrity merchandise and brand extension firm. It also invested in ZopNow Retail, an online hypermarket for groceries & related goods.


PLANS TO RAISE FUNDS – TEESORT

Sector: Retail/Textile

Business of Teesort: Teesort.com provides shopping online for designer tshirts, male t shirts, female's t shirts and latest t-shirt designs. The company provides option to the customers to put their own designs, which can be rated and the best design selected will be rewarded and put for sale. Its unique concepts such as 'Couple T- Shirts' and ability for customers to 'Vote' for their favorite designs makes it an instant hit amongst the youth.

Funding:

Teesort.com is planning to raise around $1 Mn to $2 Mn to improve processes and increase the number of designs, categories, introduce new concepts in t-shirts.

INDIAN INNOVATION FUND, IAN INVEST IN CONSURE MEDICAL

Sector: Healthcare

Business of Indian Innovation Fund:

India Innovation Fund is a SEBI registered venture capital fund that invests in innovation led, early stage Indian firms. Their focus areas include Information and Communication Technologies and Life Sciences. With the objective of maximizing the probability of the success of their portfolio companies, the fund has been structured around a collaborative web of stakeholders.

Business of IAN:

The Indian Angel Network is a unique concept which brings together highly successful entrepreneurs and CEOs from India and around the world who are interested in investing in start-up / early stage ventures which have the potential of creating disproportionate value.The Network, in addition to money, provide constant access to high quality mentoring, vast networks and inputs on strategy as well as execution.

Business of Consure Medical:

Founded in 2011 by NishithChasmawala and Amit Sharma, Consure Medical is a healthcare startup which has developed a novel, disruptive technology that will


benefit more than 16 MN patients in India and over 100 Mn patients worldwide, according to pluggd.in. The company has developed a sophisticated medical device that can be positioned as a consumer centric consumable device.

Funding:

Consure Medical has received Series A investment led by India Innovation Fund and HemantKanakia of Indian Angel Network. Other co-investors in the round include India Venture Partners, ShrikumarSuryanarayan and SaurabhSrivatsava. The company plans to use the funds to complete product development, execute their clinical & regular strategy, and commercialize its proprietary technology.

FREEMONT PARTNERS INVESTS IN MUMBAI-BASED ECO-SHOPPING PORTAL NATURAL MANTRA

Sector: Technology

Business of Freemont Partners:

Freemont Partners terms itself as country’s first global incubator and accelerator provides seed funding up to $1 million to entrepreneurs focused on technology driven startups. It includes mentorship, strategic direction and access to local and global CXO mentors and partners. The firm has partnerships with Mumbai Angels, MSGA Services Ltd, Nurture Talent among others. It has partnership with Mumbai Angels.

Business of Natural Mantra:

Started in 2011 and founded by NishantNayak, Natural Mantra concentrates on selling natural, organic and eco friendly products – free from harmful chemicals and pesticides. It currently has over 2000 organic products on its portal and the operations are mainly concentrated in the metro cities of Bangalore, Mumbai and Delhi. Its product range includes bath & body, personal care, food & nutrition, baby & kids and gifts among others and has an office in Mumbai.


Funding:

Natural Mantra raised an undisclosed amount from Freemont Partners. These funds will be used to shore up the current 4 member team along with expansion of operations.

Other Investments of Freemont Partners:

Its portfolio lists another three unidentified companies which include a digital marketing company, a global online media portal and a youth based loyalty program company.

Investments in E-Commerce Sector:

Another natural product e-commerce portal Craftsvilla had raised $1.5 Mn from its existing investors – Nexus Venture Partners and Lightspeed Venture Partners in early July this year. The e-commerce space saw quite a few fund raises and secondary investments this year – Instamojo raised angel investment in July, Fidelity, Qualcomm invested in Bigshoebazaar in the same month and the two giants Flipkart and Snapdeal were on its way to raise more funds.

Debt HINDUSTAN ORGANIC TO RAISE FUNDS THROUGH BOND ISSUE

Sector:Basic Industries

Business of Hindustan Organic Chemical Limited:

Hindustan Organic Chemicals is a GOI owned company in Mumbai. It was set up to reduce dependence on chemical imports and indigenize manufacture of basic chemicals. Its products are phenol, acetone, nitrobenzene, aniline, nitrotoluenes, chlorobenzenes&nitrochlorobenzenes.

Funding:

Hindustan Organic Chemical Limited is planning to raise R1 Bn ($18.02 Mn) through bonds.The bonds would be of one year maturity issued at 8.73% semi-annual coupon.


KKR PLANS TO LAUNCH INDIA FOCUSED DEBT FUND

Sector: Banking/Financial Services

Business of KKR&Co. LP:

KKR & Co. L.P. (formerly known as Kohlberg Kravis Roberts & Co.) is an American multinational private equity firm, specializing in leveraged buyouts. It is headquartered in New York. The firm sponsors and manages private equity investment funds.

Funding:

The LP is planning to raise $750 Mn to $1 Bn for their fund.

Rationale:

The fund is looking for opportunities in debt market citing country’s four year high interest rate. The fund will also lend to cash – strapped Indian corporations.

IIFL FINANCE TO RAISE FUNDS THROUGH NCDS

Sector:Engineering

Business of India Infoline:

It is India's premiere Share Market & Financial News and Services Portal which provides the latest news about the stock market, NSE/BSE, SENSEX news and other business & financial news.

Funding:

The NBFC subsidiary of the IIFL Group is planning to raise up to Rs.500 Cr by issuing NCDs.

Rationale:

The funds would be utilized for business activities and diversifying the borrowing sources with future such issues more likely to occur.


Disclaimer:

Circuit Breaker is an activity of Investocraft, comprising of students of MBA Capital Markets,

NMIMS. The data sources are approved Govt sites, as well as other sites respected by the

investor community like MoneyControl, VCCircle, etc

For more information, please contact:

DeeptiBawiskar: [email protected], 9158892161

MadusudananRamani: [email protected], 992015949

circuit breaker_27th august_2012

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