Street signs: Aavas Financiers on investors' radar, rail PSUs, and more

Avenue Supermarts has launched a share sale to mop up Rs 4,000 crore in fresh capital. The DMart retail chain operator will have to dilute less than 3 per cent to raise this amount. Three years ago, the company had diluted 10 per cent to raise Rs 1,870 crore in its initial public offering (IPO). Since then shares of the Radhakishan Damani-promoted firm’s market value have soared nearly eight times. Experts say Avenue Supermarts is a classic example of how well-managed companies with growth potential can reap benefits of low cost of capital. “On one hand, the environment is challenging. On the other, there is enough liquidity floating around. Companies that have demonstrated good growth and that hold potential, can access cheap capital. It is a virtuous cycle,” said an analyst. Barring employee stock options, this is the first time Avenue Supermarts is issuing fresh capital since its listing.

Samie Modak

Aavas Financiers on investors' radar 

Jaipur-based housing finance company Aavas Financiers saw institutional investors make sizeable investments on Friday. Three funds made aggregate investments of Rs 513 crore. Smallcap World Fund made the largest investment of Rs 278 crore through a bulk deal on BSE, followed by Kotak Midcap Fund (Rs 161 crore) and American Funds Insurance (Rs 73 crore). The investment came a day after the Reserve Bank of India relaxed bad loan norms for commercial real estate. In one-year period, the stock has gained 113 per cent. Analysts are positive on the housing finance company's asset quality.

Jash Kriplani 

Profit-booking in rail PSUs

Fund managers are looking to book profits in the four rail PSUs that have listed in recent times. Shares of all the four—IRCTC, Rites, Rail Vikas Nigam and Ircon International—have made good gains over the initial public offering (IPO) price. Most of the IPOs had seen good participation from mutual funds (MFs). “Although most of these stocks hold potential, we expect consolidation after the sharp run-up that most of them have seen,” said a fund manager.

Jash Kriplani