Morning Scan: All the big stories to get you started for the day

A round-up of top newspaper stories

#1. AG&P Pratham and Think Gas to merge into entity worth $1.1 billion

Two Indian city gas distribution firms, AG&P Pratham and Think Gas Distribution, which are backed by global infrastructure investor I-Squared Capital, are set to merge, the Economic Times reported, citing industry executives. The stock-for-stock merger will result in a combined entity valued at over $1.1 billion.

Why it’s important: The share of natural gas in India’s energy mix is expected to rise rapidly. The merger will provide heft and size that will help the combined entity to take on local competitors.

#2. Edelweiss leads race to acquire O2’s solar projects at enterprise value of $200 million

Sekura Energy, an energy focused platform of Edelweiss Infrastructure Yield Plus Fund, has emerged as the frontrunner to buy 350MW of solar projects from O2 Power, the Mint reported. The deal is likely to have an equity value of $50 million and an enterprise value of $200 million. The sale is being run by EY. It was earlier reported that Edelweiss, Actis Llp and Gentari Sdn Bhd were shortlisted from a dozen non-binding offers.

Why it’s important: There is keen investor interest in India’s energy transition that is now gathering pace. There are several other green deals in the pipeline as investors see a long-term business opportunity.

#3. Reserve Bank of India seen cracking the whip on P2P credit card payments

After stopping Visa from undertaking some business-to-business credit card transactions, the Reserve Bank of India is now seen cracking down on peer-to-peer credit card payments made via third party service providers, the Hindu Businessline reported. The development takes place after the central bank found instances of retail customers using credit cards to pay rent and tuition fees through third party apps.

Why it’s important: The banking overseer holds that credit card transactions are meant to be between merchants and customers. It is frowning on intermediators as they are seen as bypassing the regulations.

#4. Sovereign gold bonds help India save $3.3 billion of gold import bill

The Reserve Bank of India has sold sovereign gold bonds worth 44.3 tons in 2023-24 so far, marking the highest ever response to the instrument since its introduction in November 2015, the Business Standard reported. Since the bonds are valued at $3.26 billion, they are expected to save 7-8 percent of the country’s annual import bill for the precious metal. The import bills have already reached $37.86 billion in the first 10 months of 2023-24.

Why it’s important: The sovereign gold bonds have proved to be a success. It could be an opportune time for the government to figure out more ways to popularize them and further reduce the import bill.

#5. Local investment firm A91 Partners on track to raise its largest corpus at $700-750 million

Indian investment fund A91 Partners, backed by firms like Digit Insurance, HealthKart, Blue Tokai Coffee, and Paper Boat, is in the process of raising its largest fund at $700-750 million, the Economic Times reported. A91 Partners started in 2018 and had garnered $350 million for its first fund. It has also collected $550 million for its second fund to deploy across late-stage venture and early growth funding rounds.

Why it’s important: This fundraising from limited partners will be among the fastest scaleups in terms of size for a relatively new domestic investment fund which indicates a broader appetite for the Indian market among the sponsors of funds.

#6. Reliance’s Viacom18 rejigs top leadership ahead of merger with Disney India
Viacom18, owned by Reliance Industries, has brought its entertainment businesses under two top executives in a significant organizational overhaul ahead of its $8.5 billion merger with Disney’s India unit, the Mint reported. Kiran Mani, who joined the firm as CEO of JioCinema in November, will lead the digital and sports businesses, while the content business will be under Kevin Vaz, who joined as CEO, broadcast entertainment in July.

Why it’s important: Viacom18 is not the only broadcaster making structural changes. Rival Zee Entertainment Enterprises is also streamlining its business after an aborted merger with Sony India. Action is heating up in the country’s media and entertainment industry.

#7. Distressed tech firm Ebix puts EbixCash India operations on the block

After filing for bankruptcy in the US, technology company Ebix has started a sale of its Indian operations, the Hindu Businessline reported. The decision to divest EbixCash comes as there are limited or no prospects for listing the Indian operations. In December 2022, EbixCash filed for a Rs 6,000 crore IPO.

Why it’s important: EbixCash is the only potential cash cow for Ebix, which might find it difficult to attract buyers because of the reputational damage it has suffered. It is not an easy time for fintech companies in India as regulators tighten scrutiny.

#8. Stone Sapphire India to invest Rs 1,000 crore in Baroda homeware factory

Toys and stationery manufacturer Stone Sapphire India will invest Rs 1,000 crore to set up a manufacturing facility for homewares like glassware, sippers, dinnerware, and similar products in Gujarat’s Baroda, the Economic Times reported. This will help increase not just the production capacity for the local market but also raise exports by at least 50 percent.

Why it’s important: There is a large gap in the market for homeware products for middle class consumers as they now cater to budget class or the very high-end. Stone Sapphire intends to fill that vacuum.

#9. Max India in talks with investors to sell up to 10 percent stake in Antara Assisted Care

Max India is in discussions with private equity firms to offload a 5-10 percent stake in subsidiary Antara Assisted Care Services Ltd, the Mint reported. Max India, part of the $4 billion Max Group, is seeking a pre-money valuation of Rs 2,000 crore for the wholly owned arm.

Why it’s important: As the well-off section of India’s population ages, there is a potential booming market for senior assisted care. The sale is likely to attract buyers.

#10. Highways trust to raise Rs 4,500 crore in debt to acquire two more road projects

The National Highways Infra Trust is planning to raise an additional debt of Rs 4,500 crore to fund the acquisition of two more operational road projects from its parent organization, the National Highways Authority of India. The acquisition is expected to be concluded in the fourth quarter ending March 31.

Why it’s important: India is boosting its road and highways network at a rapid clip. Road projects have long-term revenue visibility and low operational risk, so raising debt should not be too difficult.