MC Inside Edge: Bulls look for Naidu angle, founders don’t want to be promoters, Biocon on a tear, coalition concerns

Know about all major deals and all the inner goings-on from Dalal Street.

The big draw

Modi may be a long standing favourite of Dalal Street bulls , but for the moment it is companies perceived to have friendly relations with TDP boss Chandrababu Naidu that are in demand.

Other than some of the obvious names like Heritage Foods, some HNIs are also said to have been building positions in stocks like Tilaknagar Industries and Jain Irrigation. The Honey-tongued fund manager turned ultra-HNI is said to be one of the big bulls in the Tilaknagar stock, while another Mumbai-based operator is said to have resumed his activity in Jain Irrigation. The stock had seen a 50 percent jump in the second half of 2023, but is struggling to find takers at higher levels.

Booster shot

Biocon shares hit a 52-week high on Thursday as more HNIs appear to be warming up to the story. Already, the midcap Mugul, Calculator Fund, and some clients of the Emperor brokerage have built up sizeable positions in the stock. Operating performance over the last five quarters has been steady at best, but in this market, anyone looking for stocks available at reasonable valuations will have to go for the long shots

To be or not to be... a promoter

Merchant bankers and law firms are a busy lot nowadays. And it is not just because the IPO market is booming with more than Rs 40,000 crore worth of issues in the pipeline. One particular issue that is keeping them occupied, especially if they are handling a new-age digital company, is that related to the founder and if he is falling under the definition of a promoter. A few months back, NSE, at the behest of SEBI, made it mandatory for any entity that holds over 10 percent to be classified as a promoter. It went a step ahead and mandated that all immediate relatives of the promoter and any entity with a stake of over 10 percent should also be categorised as promoter. That has made many worried as the promoter tag comes with a lot of responsibilities and restrictions, as well. The buzz in the merchant banking circle is that a lot of time is now being devoted to unshackle the shareholding pattern in a way that founders and even PE/VC players can escape being tagged as promoters.

Moving on

It will be the first mega public issue after the surprise election results pushed the markets in a tizzy. For Ixigo, however, the challenge would be two-pronged – The volatility in the secondary market along and concerns around pure-play digital companies as may of them which came out with IPOs in 2021 and 2022 are either underwater or given measly returns.

However, fund managers seemed to have recovered from those scars. The anchor allocation scheduled to happen on Friday is expected to see participation from some of the biggest mutual funds of the country along with reputed foreign portfolio investors (FPIs).