On Monday, the very same investors have turned against new-age tech companies as the space bore the brunt of the selling pressure on Dalal Street. Shares of
, Zomato, Nykaa, CarTrade, PB Fintech and Info Edge India plummeted 4-13 per cent.
The bombing of the Paytm IPO on the Street last week has triggered a reckoning for new-age companies who were offered to investors in the IPO mad rush of the past four months on sky-high valuations and “too good to be true” narratives.
For many of these companies, the narrative remains the same but the correction may offer a more realistic representation of their value.
RIL’s backtracking doesn’t go down well
Reliance Industries and Saudi Aramco have decided to not go ahead with prospective stake sale in the former’s oil-to-chemical business to the latter.
The news has been an upsetting one given that investors had very much priced in the sale of the 20 per cent stake in Reliance O2C. The move comes after RIL withdrew its application from the NCLT for the demerger of the O2C business from itself.
Shares of the country’s largest company tanked more than 4 per cent in the session. The reasoning behind the move is not apparent but it seems RIL is now happy to keep the silver candles at home given the upturn in the petrochemical business and the need for cash to invest in Mukesh Ambani’s green energy ambitions.
In the past, the energy business’ cash flow has helped subsidize the multi-billion dollar telecom and retail empire of Ambaani’s and evidence suggests he still needs it to create the fourth pillar of his burgeoning empire.
Bharti Airtel makes the move
For investors of Bharti Airtel, patience is starting to pay dividends. Five years ago, the company was virtually untouchable given the rapid rise of rival Reliance Jio Infocomm. Now, it is steadily narrowing the gap between itself and RJio.
Airtel already enjoys a considerable lead when it comes to profitability given its higher average revenue per user and the company wants to stretch it even more after it said it will be hiking tariff by another 20-25 per cent.
The telecom company wants to attain the Rs 200 ARPU by the end of the current financial year and the latest tariff hike will go a long way in achieving that, said analysts. The tariff hike helped Bharti Airtel withstand an intense selling pressure on Dalal Street and end nearly 4 per cent higher.
