MC Insider: Investor looking for investor, disinvestment is back, taming fintechs, healthcare action and more

The wild west of fintechs is getting tamed, one regulation at a time and the latest clip to its wings is the digital lending rules. So far, there is no scalpel to the earnings but fintechs aren’t less antsy. Surprisingly though some are fine coming under rules as long as bad apples get weeded out. That seems to be the problem still, according to one such fintech lender. Rules so far apply to only those that are registered with the regulator but there are many unscrupulous side hustles going on. “What is the point of nicking the good guys when you can’t kill the bad ones?” he says. Fintechs with no licence under any law but with a jazzy app are making bucks through lending which was the main problem that shook the regulator awake in the first place. But the regulator is not done prescribing rules yet and the hope is that the next set of rules don’t bleed the sincere ones to decimate the nefarious.

Last year this time, a South-based hospital chain was in the news for going on a shopping spree. It had the money to splurge and splurge it did. If you thought consolidation in the healthcare industry will pause for a bit now, think again. A little birdie told us that more buying is on the anvil. Maybe not by the same healthcare group, maybe by another, listed player from the same neighbourhood? After all, with the pandemic pushing many people to buy a health insurance policy, this is a good time to grow in healthcare and charge a premium for your brand.

In investing, as they say, luck isn't on everyone's side. Take the case of this wealthy business man-cum-investor who holds significant stake in this small private bank. The investor had exited his entire holdings in a rival bank to try his luck in this one but since the day he bought the shares, things haven't gone exactly as per his expectations. The value of shares have more than halved as the business has struggled to recover. Patience is running out. Eager to get back his money, the investor, we hear, is now talking to some of the other investors in the bank and outside to exit part of his holdings through a stake sale. Will he have luck this time? Let's wait and see.

A group of top healthcare providers returned empty handed after meeting a top health official as the government remained firm that GST on hospital room rents will not be reduced. The government logic is simple: the move will not hit the 'aam aadmi'. So what’s the big deal? A little birdie said the group was confident of raising apprehension in a meeting with the key stakeholder, but it ended even before it could start!

A recent steel industry conference in the capital had senior officials from the sector batting for the removal of export duty on steel. The sector’s top officials said the levy was hurting the industry. A senior official of a steel company said in hushed tones that his company is planning to cut capex for the current fiscal and may announce it in phases most likely after the government rolls back export duty, which is expected to come soon. When asked why they would cut capex if the duty is removed, he said that the government’s sudden decision to levy the duty had caught the industry off guard and not only shaken investors’ confidence but also made the industry revisit its aggressive expansion plans.

This recent big bang block deal by a bulge bracket private equity player in the healthcare space involving a domestic and a foreign i-bank is the toast of deal street. It ranks as the largest single selldown by a PE fund in the secondary market , the fastest exit by a PE fund since listing and the largest sale via the block deal (cumulative ) route by a PE fund. Word on the street is that the landmark transaction, which resulted in a roughly 4.7 x return for the seller, may nudge more such deals across sectors in which PE funds hold a chunky stake in a listed entity and seek to exit in a single window.

Word has it that a mega sale process of a pharma player where a cheque size of more than Rs 6000 crore was being targeted had run into rough weather due to a valuation mismatch post the initial round of bids . Well, now we picked up that the entire process has been relaunched afresh. Let's see if lady luck decides to smile this time around.

The D-word is buzzing again after a hiatus. We heard that at least five investment banks are learnt to have been picked by the sarkar for a long-awaited share sale in a firm in the commodities segment. We also picked up that the sale is likely to be carried out in tranches in the market.