"What we feel is that there is renewed buying interest in the entire startup theme and companies with some sort of a platform and online business, given that the midcap sector is back in the reckoning with the beginning of the new financial year as retail investors are looking for such beaten down names... That is where IndiaMART is fitting in,” he says.
Rakshit Ranjan of Marcellus investment Managers says the proposed merger is in line with Marcellus expects a portfolio company to do: smartly figure out how either a capital allocation decision or a business process improvement can be achieved in order to strengthen competitive advantages.
Capitalmind Founder Deepak Shenoy is of the view that the market is not giving a significant premium to the proposed merger, but only factoring in the increase in book value. "The market is looking at the increase in book value per share because the ownership of HDFC in HDFC Bank gets written down. So the effective increase in book value per share is roughly eight percent.