Delisting spree: Investors in India betting on which companies will be next

In the last two months, the majority owners of Vedanta, Adani Power, and Hexaware Technologies have proposed buying out all publicly traded shares amid the coronavirus-induced sell-off in stocks.

A wave of voluntary delisting proposals in the country's $1.8-trillion stock market is stoking bets on which entity will be the next to go private.

In the last two months, the majority owners of Vedanta, Adani Power, and Hexaware Technologies have proposed buying out all publicly traded shares amid the coronavirus-induced sell-off in stocks. With speculation rife that other firms will follow, CNBC-TV18 last month reported that Diageo is exploring options to delist United Spirits, while some traders are betting that US-based Oracle can privatise its Indian unit.

Enthusiasm to invest in shares of public companies that can go private matches a trend seen in Singapore in recent years. The premium for privatisations and takeovers in the city-state averaged about 15 per cent between 2017 and July 2019, according to the data from DBS Bank. The strategy was earlier seen in India after the global financial crisis, and, in 2009, at least one local fund manager opened a fund to buy shares in companies seen to have a high likelihood of delisting.

“I have some stocks that are bets on delisting due to their cash-rich foreign parents,” said Chokkalingam G, head of investment advisory at Equinomics Research & Advisory, adding, “A fall in stock valuations and the rupee is underpinning investments in the likely delisting candidates.”

Billionaire Anil Agarwal’s Vedanta Resources last month was the first to propose delisting of its India listed Vedanta. Its shares had collapsed about 40 per cent between January 1 through May 12 — the day before Adani Power lost 39 per cent of its market value so far in 2020.

AB InBev, Airtel lead second cluster 2 of IIM Ahmedabad placements

Unlike many other B-schools, IIM Ahmedabad follows a cluster system of final placements process where sectors are invited in cohorts at regular intervals.

Consumer goods and consumer services majors AB InBev and Airtel led the second cluster of final placements process for the two-year post graduate programme (PGP) batch of 2020 at IIM Ahmedabad.

Including pre-placement offers (PPOs), while AB InBev made the highest number of offers at eight, Airtel extended seven.

IIM Ahmedabad follows a cluster system of final placements process where sectors are invited in cohorts at regular intervals. The first cluster of the final placement process for the PGP class of 2020 at IIM Ahmedabad comprised six cohorts including advertising & media, consumer goods, consumer services, consumer electronics, general management & leadership as well as retail B2B & B2C.

Among the general management cohort, CK Birla Group made the highest number of offers at six.

Apart from AB InBev and Airtel, the consumer goods, consumer services and consumer electronics cohorts included regular recruiters like Asian Paints, CavinKare, Dabur, ITC, Lenovo, L’Oreal, Nestle, Procter and Gamble, Samsung, Tata Sky and Wipro.

The General Management and Leadership cohort comprised regular recruiters such as the Aditya Birla Group, CK Birla Group, Reliance Industries Limited and Tata Administrative Services, while the Retail B2B & B2C cohort consisted of firms like Amazon, eShakti and Apparel Group among others. New recruiters, including Colgate and Diageo, also participated in the process.

Having always had a healthy mix of diverse cohorts, a variety of roles were offered across geographies including UAE during the second cluster. In all, consumer goods firms extended the highest number of offers, closely followed by consumer services and general management firms.