Stocks of the Day

Overview & Reasons of the Stocks are in the News:

• Zee 

On Thursday, the National Company Law Tribunal's (NCLT's) Mumbai bench will issue a ruling regarding the merger plan between Zed Entertainment Enterprises Limited (ZEEL) and Culver Max Entertainment (Sony).

On July 10, the division bench, made up of members Madhu Sinha, a technical member, and HV Subba Rao, a judge, deferred its decision regarding the merger. The division bench enabled parties to submit written arguments while reserving the order.

• Axis Bank

Axis Bank is set to increase its stake in Max Life from 9.99% to 16.22% by investing Rs 1,612 crore through preferential share allotment. This move follows Axis Bank's earlier acquisition of a 12.99% stake in Max Life in 2021. With this new investment, Axis Bank and its entities will collectively hold 19.02% of Max Life, while Max Financial Services, the holding company of Max Life, will retain around 80.98%. 
The infusion will be executed through a share subscription agreement for 14,25,79,161 equity shares at a value of Rs 113.06 per share. Max Financials ownership will decrease from 87% to 80.98% post infusion. The capital injection aims to support Max Life's growth, reinforce capital position, and enhance solvency margins. The governance structure will involve five nominee directors from Axis entities and three from Max Financial on Max Life's board. Axis entities' directors, along with one from Max Financial, will constitute the quorum for board/committee meetings. The transaction awaits regulatory approvals, with Axis Bank having secured the Reserve Bank of India's approval.

• Suzlon

Suzlon Energy shareholders have approved a plan to raise Rs 2,000 crore through a qualified institutional placement (QIP), with the goal of reducing debt and supporting working capital and capex needs. The company's shares rose by 4.99% to Rs 19.56 on the BSE in response to the news. The QIP will involve equity shares with a face value of Rs 2 each, totalling up to Rs 1,500 crore, with an option to retain an oversubscription of up to Rs 500 crore. The floor price for the shares has been set at Rs 18.44, with a possible discount of up to 5%. 
Suzlon Energy has undergone debt restructuring and capital infusion efforts since 2020, leading to a significant reduction in debt. The company's gross debt dropped from over Rs 13,000 crore in March 2020 to Rs 1,806 crore at the end of the June quarter in 2023, resulting in a healthy net debt-to-net worth ratio of 0.9. The company plans to use the raised funds to continue deleveraging, release cash for working capital and capex, and target a larger market share in wind energy projects.

• L&T

Indian engineering firm L&T, in collaboration with joint venture partners Indian Oil Corporation and ReNew, is committing up to $4 billion (₹32,000 crore) for their green hydrogen initiatives over a span of three to five years. The investment aims to advance their green hydrogen businesses. L&T has previously entered agreements with McPhy Energy for the production of electrolysis units and an exclusive license to employ their pressurized alkaline electrolyser technology. This effort aligns with L&T's joint venture with Indian Oil Corporation and ReNew in the green hydrogen sector.

• Axis Finance

Axis Finance's bid to involve Zee Entertainment Enterprises Limited (ZEEL), Essel Mauritius, and Culver Max Entertainment in a lawsuit against ZEEL promoter Subhash Chandra Goenka has been dismissed by the Bombay High Court. The court rejected the application made by Axis Finance to include these entities in its effort to recover INR 146 crore from Subhash Chandra Goenka, who is associated with ZEEL.

• NHPC

NHPC Ltd, a state-owned company, is exploring the development of approximately 20,000-22,000 MW of pumped hydro energy storage projects in states like Odisha, Maharashtra, Madhya Pradesh, and Andhra Pradesh. The company is prioritizing hydro power due to its current opportunities. Plans for solar energy capacities are also in place. 
Detailed project reports and approvals are expected to take a few years before construction begins, with the project viability being assessed first. The government recognizes pumped hydro storage and battery energy storage systems as crucial for grid balance alongside renewable energy expansion.

• Axis bank

Axis Bank plans to increase its stake in Max Life from 9.99% to 16.22% by investing Rs 1,612 crore through a preferential share allotment. This follows Axis Bank's earlier acquisition of a 12.99% stake in 2021, which will result in a total ownership of 19.02% in Max Life, while Max Financial Services will retain about 80.98%. 
The proposed capital infusion aims to support Max Life's growth, enhance its capital position, and strengthen solvency margins. Both companies have agreed on the governance structure, with a combined board of five nominee directors from Axis entities and three from Max Financial. Regulatory approvals are pending, although Axis Bank has secured approval from the Reserve Bank of India for the acquisition.