Street signs: Bharti Airtel RE trading, MF compensation norms, and more

Airtel RE trading set to commence

The trading in rights entitlement (RE) of Bharti Airtel will commence on Tuesday and will remain open till October 14. Under this window, existing shareholders will get to sell their RE, while those who wish to participate in the Rs 21,000-crore rights offering will get to buy the permit to apply. One RE gives a shareholder right to subscribe to one share in the rights issue programme, which will remain open till October 21. Analysts expect one RE to trade in the range between Rs 180-200 per unit. Shares of Airtel last closed at Rs 676, while the rights issue price is Rs 535 per share. ETFs will sell their REs as they are not allowed to subscribe for shares in the rights issue. Last year, trading in Reliance Industries RE had seen huge investor interest.
 

Rally boosts Tata Power’s MSCI prospects

Tata Power’s MSCI inclusion prospects have got a boost following a 23 per cent jump in the stock over the past one month. The stock last closed at Rs 164. The scrip will, however, have to rally another 5-7 per cent from current levels over the few trading sessions. “Tata Power should safely qualify for MSCI Standard Index Inclusion if it stays above 173-175 levels around the cutoff date,” said an analyst. Tata Power wasn’t in the initial list of probables to make it to the index. An inclusion in MSCI Standard Index will boost foreign flows into the stock next month when the changes would become effective.

New compensation norms churn MFs 

Mutual fund (MF) industry staffers are looking to make a switch to insurance, private equity, and alternative investments funds (AIF) segments as the new compensation rules kick in this month. Industry players say the highest churn is happening at the junior level. This despite market regulator Sebi saying those below 35 years — will have to invest 10 per cent in the first year and 15 per cent in the second year in their schemes, instead of 20 per cent for other employees. Industry players say many feel that the new norms are authoritative, prompting some to make a switch to other segments of the financial sector.