Tale of the Tape 

Good evening everyone. Markets were boring AF!

Nifty and Sensex barely moved, closing with minor gains. Broader markets were equally lifeless with Midcaps and Smallcaps ending flat. The advance-decline ratio was split evenly. Most sectors finished up. Oil & Gas (+1.1%) and Pharma (+0.5%) saw the most buying. IT stocks (-0.5%) witnessed profit-booking.

In today’s issue of the Daily Rip, we dive into the inheritance battle that’s weighing on Sona BLW, unpack Tega Industries’s big acquisition, trending charts and more.

Honourable Mentions:

Aurobindo Pharma rallied +6% after falling out of the race to acquire US-based drugmaker Zentiva. PS - that’s good news because markets were against the deal amidst valuation concerns. Jupiter Wagons was up +4% after bagging a Rs 113 cr bogies supply order from the Railways.

Check out the NSE 500 heatmap:

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Succession Drama At Sona BLW

Sona BLW has fallen -19% since the death of its chairman Sunjay Kapur in June! This is because his demise has set off a three-way ‘Succession’-style inheritance battle. Until it’s resolved, there will likely be an overhang on the stock. PS - the facts are all up in the air, so for now just take in all the masala that’s being aired out. 

First off, the stakes. Sunjay left behind a whopping Rs 30,000-cr estate. Crucially, this includes control over a family trust that has a 28% promoter stake in Sona BLW and ownership in other unlisted entities in the Sona empire. Here’s the twist: his will allegedly left ALL his personal assets to current wife Priya Kapur.

This pissed off two sets of parties: 

1) Sunjay’s family: His mom claims she was “forced” to sign documents just before the AGM that approved Priya’s appointment as director. Both the mom and sister also say they are owed assets worth Rs 10,000-cr and that some Sona BLW shares were illegally sold off. FYI - all these allegations have been denied.

2) Karisma Kapoor: Yes, the Bollywood star who was Sunjay’s first wife. They had two children, both of whom were allegedly listed as beneficiary owners on the family trust. Karisma and the kids have moved the Delhi HC challenging the will + asking for a list of assets. Sunjay’s mother has also joined Karisma in their court case.

Big Picture: The Delhi HC will have the final say on who inherits Sunjay’s estate. But the bigger question is whether Sona BLW will be impacted. Right now the company is managed professionally with over 70% of shareholding with the public + institutional investors. Until we know who ends up with Sunjay’s stake and their plans for the company, experts say the stock could remain under pressure.