In the past quarter the stock had hit a 52-week high of Rs 45.85 on 17 September 2009. The stock had outperformed the market in past one quarter, jumping 29.62% as against 9.47% rise in the Nifty 50 index.
The mid-cap steel casting maker had an equity capital of Rs 28.73 crore which grew to 31.27 crore at June end to 32.67 as of now. Face value per share is Rs 1.
The company is planning for QIP placement in near future which is meant to augment the long- term resources, including working capital requirement, and to develop iron-ore mines, coking and non-coking coal mines. Part of the proceeds will also be used to build a war chest for future opportunities, reports suggest.
Promoters have raised their stake in the company over past quarter to 47.90 % against earlier 45% through conversion of warrants. Recent lapse of warrant conversion of shares (convertible at Rs. 68 and Rs.81) due to steep discounted share prices in markets has added 48 paise per share. Sucessful closure QIP issue at around CMP 44 - 45 plus level will provide good support to share prices. In recent past the stock prices have consolidated at 44 - 45 level through in past 15 days shares haven't been able to breach 45 - 46 level it has challenged those level almost every alternate trading session on good volume. Breakout over 46 on closing basis will take stock to new 52 week high of around Rs 51-55. I expect stock to trade at 50+ levels in next quarter and 60-65 level in next 6 -9 months period.
The mid-cap steel casting maker had an equity capital of Rs 28.73 crore which grew to 31.27 crore at June end to 32.67 as of now. Face value per share is Rs 1.
The company is planning for QIP placement in near future which is meant to augment the long- term resources, including working capital requirement, and to develop iron-ore mines, coking and non-coking coal mines. Part of the proceeds will also be used to build a war chest for future opportunities, reports suggest.
Promoters have raised their stake in the company over past quarter to 47.90 % against earlier 45% through conversion of warrants. Recent lapse of warrant conversion of shares (convertible at Rs. 68 and Rs.81) due to steep discounted share prices in markets has added 48 paise per share. Sucessful closure QIP issue at around CMP 44 - 45 plus level will provide good support to share prices. In recent past the stock prices have consolidated at 44 - 45 level through in past 15 days shares haven't been able to breach 45 - 46 level it has challenged those level almost every alternate trading session on good volume. Breakout over 46 on closing basis will take stock to new 52 week high of around Rs 51-55. I expect stock to trade at 50+ levels in next quarter and 60-65 level in next 6 -9 months period.
Looking at the above recommendations is to hold / accumulate at every fall in prices.
Updates on QIP
Electrosteel Castings Ltd has informed BSE that the Board of Directors of the Company at its meeting held on September 15, 2009, has approved composite QIP issue for an amount upto Rs. 6000 Million. The composite QIP issue consists of issue of Equity Shares and Non Convertible Debentures (NCDs) with warrants. This two-pronged strategy would enable the Company to derive maximum value from the fund raising process. The Equity issuance is expected to be of about Rs. 1000 - 1500 Million, and the NCDs size would be of about INR2000 Million. The NCDs shall also have the option to subscribe for the convertible warrants into Equity Shares for an amount upto Rs. 2000 Million. The warrant holder shall have an option to convert the same into Equity Shares between a period of 3 - 5 years. The issue price or Equity Shares and warrant would be determined in consultation with the Merchant banker based on the SEBI regulations.
Updates on QIP
Electrosteel Castings Ltd has informed BSE that the Board of Directors of the Company at its meeting held on September 15, 2009, has approved composite QIP issue for an amount upto Rs. 6000 Million. The composite QIP issue consists of issue of Equity Shares and Non Convertible Debentures (NCDs) with warrants. This two-pronged strategy would enable the Company to derive maximum value from the fund raising process. The Equity issuance is expected to be of about Rs. 1000 - 1500 Million, and the NCDs size would be of about INR2000 Million. The NCDs shall also have the option to subscribe for the convertible warrants into Equity Shares for an amount upto Rs. 2000 Million. The warrant holder shall have an option to convert the same into Equity Shares between a period of 3 - 5 years. The issue price or Equity Shares and warrant would be determined in consultation with the Merchant banker based on the SEBI regulations.
The Company would now seek the approval of the Shareholders.
Other significant updates on warrant conversion:
The promoters stake has gone up to 47.90 on enhanced equity capital by addition of approx. 1.40 crore shares on conversion of warrants.
Meanwhile, the ECL board has cancelled the warrants issued in March last year. The company had allotted 87 lakh warrants convertible at Rs 68 per share to a foreign entity on 11 March 2008. The company had also received Rs 5.91 crore representing 10% of the total consideration towards the allotment of the warrants. The warrants were convertible within 18 months from the date of allotment, and the last date of conversion was 11 September 2009. However, the applicant did not opt for the conversion as the ruling market price was at a steep discount to the conversion price. As a consequence, the entire amount received has been forfeited and the warrants cancelled.
Electrosteel Castings Ltd has informed BSE that subsequent to the approval of the shareholders in its meeting dated January 25, 2008, the Board of Directors on March 24, 2008 allotted 12137146 convertible warrants issued for cash of Rs. 81/- per share to a Foreign Company. As per provisions of SEBI (DIP) Guidelines, the Company had also received Rs. 983.11 Lakhs representing 10% of the total consideration towards allotment of said warrants. In terms of SEBI (DIP) Guidelines, the said warrants were convertible within 18 months from the date of allotment and the last date of conversion was September 24, 2009. As the applicant did not opted for conversion of said warrants within the permissible time of 18 months, the entire amount received thereon from the applicant stands forfeited and accordingly, all 12137146 convertible warrants stands canceled.
Based on lapse of warrants issued by the company and forfeiture of amount Rs. 15.74 crore. This work out to around 48 paise per share on equity capital of 32.67 crore.
The promoters stake has gone up to 47.90 on enhanced equity capital by addition of approx. 1.40 crore shares on conversion of warrants.
Meanwhile, the ECL board has cancelled the warrants issued in March last year. The company had allotted 87 lakh warrants convertible at Rs 68 per share to a foreign entity on 11 March 2008. The company had also received Rs 5.91 crore representing 10% of the total consideration towards the allotment of the warrants. The warrants were convertible within 18 months from the date of allotment, and the last date of conversion was 11 September 2009. However, the applicant did not opt for the conversion as the ruling market price was at a steep discount to the conversion price. As a consequence, the entire amount received has been forfeited and the warrants cancelled.
Electrosteel Castings Ltd has informed BSE that subsequent to the approval of the shareholders in its meeting dated January 25, 2008, the Board of Directors on March 24, 2008 allotted 12137146 convertible warrants issued for cash of Rs. 81/- per share to a Foreign Company. As per provisions of SEBI (DIP) Guidelines, the Company had also received Rs. 983.11 Lakhs representing 10% of the total consideration towards allotment of said warrants. In terms of SEBI (DIP) Guidelines, the said warrants were convertible within 18 months from the date of allotment and the last date of conversion was September 24, 2009. As the applicant did not opted for conversion of said warrants within the permissible time of 18 months, the entire amount received thereon from the applicant stands forfeited and accordingly, all 12137146 convertible warrants stands canceled.
Based on lapse of warrants issued by the company and forfeiture of amount Rs. 15.74 crore. This work out to around 48 paise per share on equity capital of 32.67 crore.
2 comments:
I really apreciate the information. looking forward to see such more information in future.
Thanks Aegis,
Unfortunately I met with an accident had injury in my right arm elbow, so have reduced writing till i fully recover.
Any specific queries can be posted on blog and I will try to reply them to best of my ability.
Thanks
Vivek
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