The Hindu Business Line : Exit option for Dhanus investors

Recent developments relating to Dhanus Technologies (Dhanus) — a company which made a recent initial public offering—may affect investor sentiment towards the stock on listing and lower chances of any potential listing gain. A company statement on Thursday, has drawn attention to issues relating to seizure of calling cards from its premises and CBI raids and subsequent recovery of cash and property documents from its Managing Director. Pursuant to this, the company has provided for time until October 6 2007, allowing investors including institutional bidders to withdraw their IPO applications.

Unattractive offer

In any case, the offer appeared unattractive purely from a business point of view (Refer Business Line, Investment World section, dated September 9). International calling cards, fleet tracking devices and IT/BPO are the key business segments for the company. With heavy competition from established players in its calling cards division, the relatively small market for fleet tracking in India and less than promising prospects for it’s IT and BPO divisions, there are uncertainties about the company’s ability to deliver sustainable growth. Now, recent developments indicate that there could also be governance issues with respect to the company. In light of this, the exit window provides retail investors an option to exit from this offer.

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