Kotak MF to sell unlisted Chennai Super Kings shares

BL Mumbai Bureau | Updated on: Feb 11, 2022
Last date for submission of the bid is February 14 

Last date for submission of the bid is February 14  | Photo Credit: Pallavi Hari 10095@Chennai

Company shares soar over 1,000 per cent since the demerger, said a dealer facilitating trade in unlisted stocks

Kotak Mahindra Asset Management Company has invited bids to sell one lakh equity shares of unlisted Chennai Super Kings (CSK) held by Kotak Equity Saving Fund. The last date for submission of the bid is February 14 and the price quoted by the bidders will be valid for 30 days from bid closure date, said the fund house in a statement on Friday.

This comes even as the auction for the next edition of IPL is set to start on Saturday. A total of 590 players (370 Indian and 220 foreign) will be up for grabs. By the end of the auction, each team should have a minimum of 18 players and a maximum of 25 players in their squad.

Nilesh Shah, Managing Director, Kotak Mahindra AMC, said the CSK shares were allotted as part of a scheme of demerger from India Cements and the scheme was approved by all the regulatory authorities. Normally, the demerged entity is listed on stock exchanges in a short period of time.

Unfortunately, he added, due to variety of reasons, the CSK shares have remained unlisted for the last few years despite investors’ follow up, and the investment in CSK is in compliance with SEBI regulations. In absence of traded prices, the fund house has decided to sell part of the holding for price discovery in a transparent manner, said Shah.

Chennai Super Kings came into existence in 2008, when N Srinivasan-owned India Cements bought the franchise rights for ₹346 crore, to be paid in 10 equal instalments over 10 years until 2017-18. In 2018, India Cements transferred the entire shareholding of CSK to a shareholders’ trust and allotted one share of CSK for every one share of India Cement held by its shareholders.

Revenue, profits down

Of the overall 14 editions of the Indian Premium League played so far, CSK has won the finals four times, and was also banned for two years in 2016 and 2017.

Chennai Super Kings had reported a lower profit of ₹40 crore for the year ended March 2021, down from ₹50 crore logged in 2019-20. It reported a revenue of ₹254 crore for the year under review, down from ₹357 crore in the preceding year. It cited the Covid pandemic as the reason for the drop in total revenue and profits.

According to the annual report of the company, it has decided to conserve resources and skipped the dividend for the year ended March 31, 2021. The company shares have soared over 1,000 per cent to ₹215 a share since the demerger, said a dealer facilitating trade in unlisted stocks.

Published on February 11, 2022
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