Month: May 2021

Glenmark Lifesciences IPO

Glenmark Life Sciences Ltd, a wholly-owned subsidiary of Glenmark Pharmaceuticals Ltd, has filed a draft red herring prospectus with SEBI for an IPO for Rs 1,160 crore.

The IPO consists of a fresh issue of up to Rs 1,160 crore and a sale of up to 73.05 lakh equity shares of Glenmark Life Sciences Ltd at a price of Rs 2 apiece by Glenmark Pharmaceuticals Ltd. Goldman Sachs, Kotak Mahindra Capital, BoFa Securities, DAM Capital, BoB Caps and SBI Capital Markets are the lead managers to the issue. The API business is critical to the organisation, with API operations accounting for 84.16 percent of total revenue from operations in fiscal 2020 and 89.87 percent in fiscal 2019.

Supriya Lifesciences IPO

Supriya Lifescience Ltd, a bulk medicines company, has filed a draft red herring prospectus (DHRP) with the Securities and Exchange Board of India (Sebi) to raise Rs 1,200 crore through an IPO (IPO). The IPO comprises of a fresh issue of 200 crore and an offer for sale by promoter Satish Waman Wagh for up to 1,000 crore. The issue’s lead managers are ICICI Securities and Axis Capital. The firm plans to expand its existing manufacturing facilities in Lote, Maharashtra, as well as continuing to invest in existing manufacturing technology to support the production of its active pharmaceutical ingredient portfolio (APIs).

Supriya Lifescience is a leading manufacturer and supplier of APIs in India, with a strong focus on R&D.

Windlass Biotech IPO

Windlas Biotech Ltd has filed preliminary papers with the Securities and Exchange Board of India (Sebi) for an initial public offering (IPO) that includes a fresh Rs 165 crore issue. The IPO consists of a 165-crore new issuance and a 5.14-million-share offer for sale by the company’s current promoters and shareholders. Vimla Windlass is selling 1.14 million shares and Tano India Pvt Equity Fund II is selling 4.01 million shares as part of an offer for sale. Vimla Windlass currently owns 7.8 percent of the company, while Tano India Pvt Ltd owns 22 percent. SBI Capital Markets, DAM Capital Advisors and IIFL Securities Ltd are the book running managers to the issue. The company would use a total of Rs. 47.56 crore to meet additional working capital requirements and Rs. 20 crore to settle certain debt. Its total outstanding borrowings were Rs32.16 crore as of March 2021.

Emcure Pharma

The IPO will include new shares as well as an offer for sale from the business’s promoter Satish Mehta and investor Bain Capital, who bought a 13% stake in the company in 2014. While the corporation is aiming to sell up to a 20% share, it is unclear whether Bain will sell the entire company.

Veeda Clinical Research

Veeda Clinical Research, which is backed by CX Partners, is planning an IPO of Rs 500 crore, with JM Financial and SBI Caps as advisors. The paperwork have yet to be filed with Sebi.

A glance at fixed deposits and debt mutual funds

You invest a lump-sum amount of money in a fixed deposit (FD) account for a fixed tenure at a fixed rate of interest which is not impacted by any market fluctuations. Though investing in fixed deposits for a tenure of 5 years will allow you to seek tax benefits, they are the most preferred investment options for senior citizens as they get additional interest rate than the general public in the form of regular income. In terms of risk, debt funds are riskier than traditional FDs. The basic purpose of a debt fund is to provide a consistent return to investors throughout the course of the investment period. Debt funds are safer than equity funds because the underlying assets in debt funds are generally bonds, government securities, money market instruments, commercial papers, and other debt-related securities. However, MFs in the debt category offer a greater range of options for maintaining short-term investments and can be utilised as a substitute to bank FDs.

Risk

When it comes to determining which investment option to pursue, risk is likely the most significant aspect to discuss. FDs provide investors with guaranteed returns, and the specified interest you get does not fluctuate from the ups and downs of the market. If you want guaranteed returns with no risk, bank fixed deposits are a good option. If you want to reap possibly better returns at the sacrifice of a higher risk, you may explore investing in funds from appropriate mutual fund categories that match your goals and risk tolerance. When comparing debt funds versus FDs in terms of risk, the bank ensures capital safety because your deposits are insured by the DICGC. If a lender goes bankrupt, investors’ deposits – including principal and interest – are insured up to Rs 5 lakhs by DICGC, and hence FDs are considered risk-free investments. Debt funds are vulnerable to market fluctuations, and capital security is not guaranteed. In a debt fund, there are two types of risk: interest rate risk and credit risk. Interest rate risk is lower in debt funds that invest largely in money market instruments, but interest rate risk is higher in Gilt funds with long durations. The credit risk is determined by the underlying securities’ credit ratings. The interest rate on a fixed deposit is pre-determined for the duration of the deposit. Whereas, returns on a debt fund may fluctuate based on interest rate movements. If interest rates rise, the yields on your portfolio’s securities drop, resulting in lower net asset values (NAVs) and, as a result, lower returns. If interest rates decrease, on the other side, NAVs will rise.

Returns

Fixed deposits and debt funds provide different returns, just as they do in terms of risk. The rates of return on FDs vary depending on the term of the deposit, the type of depositor you are, and the current market rates. When market rates are low, FD interest rates typically fall as well, and vice versa. The repo rate is an important factor in determining the market rate. Nevertheless, once locked in, your investment will continue to earn the same interest at a fixed rate for the duration of the term, regardless of whether market rates rise or fall. Debt funds, unlike FDs, do not promise guaranteed returns. Debt fund returns are market-linked, but they have historically outperformed FDs having similar maturities, according to past records. When general interest rates rise, appetite for current debt funds falls, resulting in a decrease in NAV and yields. When interest rates fall, the reverse happens.

Taxation

The interest you receive from a fixed deposit is added to your net income and taxed according to your tax slab rate. TDS is levied on interest earned if it exceeds Rs. 40000 for regular residents and Rs. 50000 for senior citizens in a year. Whereas there are short-term capital gains (STCG) for holding durations of up to 36 months and long-term capital gains (LTCG) for holding durations of more than three years when it comes to debt mutual funds. If you withdraw debt funds before three years, they will be treated the same as a fixed deposit – gains will be added to your income, and you will be subject to income tax as per your slab rate. Debt funds are taxed at 20% with indexation and 10% without indexation if held for more than three years.

Liquidity

Because debt funds can be redeemed at any time, they are more liquid than fixed deposits. You can make premature withdrawals, but after incurring a penalty, you may be able to earn a lower interest rate on the amount withdrawn from your fixed deposit. You can redeem your debt fund assets at the current NAV, which may be lower or higher than the amount you initially deposited. Exit load is applied on debt fund redemptions during the exit load period and is levied on the redemption amount. You can redeem units for free after the exit load time has ended. Before investing, you should look at the exit load structure of debt funds and the penalty charges imposed by banks on fixed deposits.

Tenure and flexibility

There isn’t a lot of diversity when it pertains to fixed deposits. Fixed deposits are available at the post office or banks. Banks provide different interest rates which are currently around 5.5% of some leading banks. Compared to commercial banks, some small finance banks may give you higher interest rates of more than 7%, but they also involve risk. Debt MFs invest in government bonds, PSUs, money market, corporate debentures, and so on. Each category of the fund has its own set of risks and perks. Fixed deposits are for a specific period, ranging from a week to ten years. Debt funds are offered for a variety of time periods, ranging from one day (overnight funds) to more than seven years (long duration funds). There are also short-term debt funds that invest in bonds with a one- to three-year maturity duration. It’s a good fit for low-risk investors who have a similar holding period. For investors with higher tax brackets, it is a more tax-efficient option than fixed deposits. As a result, you must make your decision based on your financial objectives and investment term.

Our take

Debt funds have historically provided superior returns than fixed deposits. Debt funds may be a good bet from a tax standpoint, especially if you plan to maintain them for a long period. If capital security and guaranteed returns are your top priorities, a fixed-deposit investment is a way to go. When comparing Debt Fund vs FD, you may earn possibly higher returns by investing a portion of your fixed-income assets in debt mutual funds. You can also enjoy tax benefits in debt mutual funds, which is the main advantage of debt mutual funds. However, if you are in a higher tax rate and have a longer investment horizon than three years, debt funds are more tax-efficient than bank FDs. But here the matter of concern is that due to interest rate volatility, debt funds may have negative returns and Long-term debt funds are more exposed to interest rate risk. Debt funds, on the other hand, invest in fixed-income assets which makes them less risky than equity funds. Based on your investment goals and risk profile, you may choose the best debt fund. Take a peek at the debt fund’s portfolio. Debt funds with AAA-rated bonds in the portfolio are secure to bet.

Indian cryptocurrency investors were unable to transact in cryptocurrencies only recently owing to banking sector cautiousness on the digital currency landscape. Also, they were being warned that their accounts might be closed if they continue to trade in these cryptos.

Nonetheless, despite all the hostility shown towards the crypto market, the new and nascent asset is being variedly used to earn an investor a substantial return.

Now among the latest is the lending of cryptocurrency to earn better returns:

Zebpay’s first of its kind lending facility for cryptos:

The tagline given by the oldest cryptoexchange for the service is ” Paisa hi paise ko khichta hai? Ab se, crypto bhi crypto ko kheechega!”

Coined as the Zebpay Lending Platform- the facility shall enable cryptocurrency holder to earn fixed return

Zebpay’s Digital Lending platform:

The cryptoholder can choose to lend his or her cryptocurrency holding with the exchange
1. For a open term
2. For a fixed term

Accordingly the return shall be determined for him or her. For these lent cryptos the return shall be credited on a daily basis into your trading wallet.
Now for cryptocurrency holdings over and above their appreciation value, investor in cryptocurrency can earn fixed annualized return:

Here is the listed annualized return pay chart as per the Zebpay site