Any thoughts on the 3 independent directors resigning ?
Company says it was done to ensure smooth functioning of the board, in view of maximum tenure guidelines as per which any director can remain for maximum 10 years (2 five year terms). But their immediate departure raise some concern. Since these 3 names are well known in their field, their sudden departure raise few eyebrows. I think that’s why market is bit nervous today even after declaring good set of numbers. Lets hope there is nothing more to that, than meets the eye 
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As PEL is already is into wholesale finance, why is it that PEL wants to buy the whole of DHFL ?
It will most likely be available at a significant discount?
Resignation letters from outgoing independent directors: https://www.bseindia.com/xml-data/corpfiling/AttachHis/8a37fcfc-d86f-42c2-8e48-15b18b44ef3b.pdf
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Good article on state of Lending Market to real estate developer, which is a key business area for PEL.
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https://www.rbi.org.in/Scripts/BS_PressReleaseDisplay.aspx?prid=50695
will piramal be eligible for banking license? I know it is easy for Bajaj Finance to convert to bank now
“Well run large Non-banking Finance Companies (NBFCs), with an asset size of ₹50,000 crore and above, including those which are owned by a corporate house, may be considered for conversion into banks subject to completion of 10 years of operations and meeting due diligence criteria and compliance with additional conditions specified in this regard.”
Piramal meets the 50,000 cr and 10 year criteria but will fail the “well-run” test imo.
Looks like Piramal is out to hire independent directors in the field of startups/venture capital/Private Equity background. First was Kunal Bahl of Snapdeal and now Anjali Bansal with experience with TPG Growth Capital, Spencer Stuart etc. These new independent directors replaced big names like Keki Dadiseth and Raghunath Mashelkar. I was bit worried when I first heard about resignation of these stalwarts. But after seeing new names, I feel company is making conscious efforts to bring in fresh thinking and perspectives. Positive sign for the company.
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Why would they fail the well run test ? Is it because of the developer concentration?
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Piramal seeing value in entire DHFL portfolio. Not sure if this is good or bad, in the long term for the company.
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CNBC is reporting that Piramal’s have sold their glass business at $1 billions.
I know PEL does not have any interest in Piramal Glass directly.
I am wondering if there is any impact on PEL? Is there is possibility that promoters increase stake in PEL further as they go more funds available at their disposal after selling Glass business?
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Competitive bidding generally not a good news for buyers as they tend to overbid in its zeal to win the bid.
In the past, Ajay Piramal mentioned that they would never acquire financial company as it is really difficult to find out the true value and is difficult to align acquired company culture to Piramal’s culture and ethos. So when I noticed PEL throwing its hat in the ring for DHFL, I was disappointed (and also concerned) with this. So I am happy that PEL is not winning the bid. I hope PEL would walk away from DHFL now and focus on its main business.
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PEL is bidding for the Portfolio and not the company as a whole.
It completely make sense to do so, it’ll not affect the culture or strategy.
It’s more like a PE deal, where you buy some 80kcr worth stuff for some 35k ( that to funded by 10% cost of debt and hardly any equity)
Securitize, sell the good portfolio in parts and recover the 35kcr and for the rest of the corporate portfolio you recover the properties, bring your existing developers into play generate value and exit.
It’s like a one time opportunity for generating some 30-50% networth boost for PEL.
Totally worth it, and PEL did these type of one time entry exits multiple times in the past. This time the bet is far more value accretive than any other transactions in the past.
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I have read different news that what is said by CNBC. see below
So lets wait for the formal announcement.
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Is PEL parent company of Piramal glass ?
No, Piramal glass is privately owned by Piramals (the promoters) and has no connection with the listed entity PEL
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As per CNBC TV18’s today’s report, although Oaktree has the highest bid, Piramal can still win the bid as their upfront payment is higher and being Indian company, they have less regulatory challenges as compared to Oaktree Capital.