Indiabulls Real Estate skyrockets on promoters’ stake hike 

Meera Siva BL Research Bureau | Updated on January 24, 2018


Promoter group raises holding to 10%; stock sees healthy rollover of 38% to July series

The stock of Indiabulls Real Estate gained a whopping 33 per cent on Monday to ₹56.15 on the BSE and closed the day a tad lower at ₹54.75, a gain of 30.03 per cent over the previous day’s close of ₹42.05.

This was thanks to the company’s promoter group entities raising stake by an additional 10 per cent. After the stake purchase, the promoter group entities’ holding will increase to 37 per cent.

Though the stock recovered sharply on Monday after hitting its year-low of ₹41 on Thursday last, the stock is still far away from its year high of ₹101.60 and all-time high of ₹848 in 2008.

Since the stock trades in the derivatives segment too, it does not attract any circuit filter on the exchanges.

Temporary phenomenon?

On the NSE, Indiabulls Real Estate futures witnessed a healthy rollover of 38 per cent to July series. However, none of its options in the July series witnessed any trading, signalling that Monday’s rise could be a temporary phenomenon.

The board of directors of the company, on Saturday approved the preferential offer and issue of up to 3.67 crore equity shares of ₹2 each and up to 4.36 crore warrants, convertible into an equivalent number of equity shares of ₹2 each to promoter group entities at an issue/conversion price of ₹67 a share

Fund-raising trend

As a result, the promoters will invest ₹538 crore and this will help reduce the company’s debt.

Fund-raising seemed to the theme of the day in the realty sector. Earlier, Mumbai-based Oberoi Realty’s board approved raising ₹324 crore. Preferential shares will be issued to Aranda Investments, a foreign portfolio investor. The offer will be priced at ₹295. Oberoi’s shares were up over 2 per cent and traded at ₹302.

The positive sentiment seemed to have rubbed off on other realty stocks as well. The BSE Realty index was the biggest gainer on Monday’s trade, with 5.05 per cent gain at 1,420.38.

Shares of Bengaluru-based Puravankara Projects gained over 6 per cent to ₹71. The shares have been on a downtrend in the last few months. Shares of DLF gained nearly 6 per cent, while that of Mumbai-based HDIL gained 4 per cent.

Published on June 22, 2015

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