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R. Ravikumar

Chennai, Sept. 1 TTK Prestige Ltd on Monday informed the stock exchanges that the promoter of the company TT Krishnamachari & Co is desirous of delisting the equity shares from Bombay Stock Exchange and the National Stock Exchange in accordance with SEBI (Delisting Guidelines 2003).

According to Mr K. Shankaran, Director, Corporate Affairs, there were various reasons behind the move. He said the decision to delist the company from stock exchanges is primarily because the market price for the stock does not reflect the true value of the company. “And moreover, the liquidity in the market is not much for the stock of late; hence the promoter has decided delist after formal approval from shareholders.”

He also said that the company’s decision to invest substantially in its proposed new format retail stores and promotional activities may put pressure on the company’s bottomline and as a result, earnings per share may go down in the next couple of years till it gets stabilised. Besides, there are some delays in the company’s real estate projects owing to various procedural reasons. “These may not bode well for the company in the public domain,” he said.

If approved by shareholders, in the extra-ordinary general meeting of the company scheduled for September 25, the promoters may increase their holding to 75 per cent from the present 72.3 per cent, “which may be through the reverse book-building route,”said Mr Shankaran.

Today, the stock of TTK Prestige jumped 6.7 per cent to close at Rs 169.55 on the BSE. Trading volumes also jumped to 1.59 lakh shares against its two-week average volumes of 54,000 shares. The stock gained 28 per cent in one week’s time and 47.5 per cent in one month’s time. The stock’s 52-week high and low are Rs 234 and Rs 96 respectively.

For the quarter ended June 30, it reported a net profit of Rs 5 crore on a turnover of Rs 85.8 crore. For the year ended March 31, 2008, the net profit stood at Rs 20.6 crore on a turnover of Rs 327.4 crore against Rs 11.7 crore on Rs 281.6 crore.

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