Stocks

Dunlop stock rolls again

| | Updated on: Apr 19, 2012

Scrip hits upper circuit on resumption of trading

After a 21-day trading suspension, the shares of Dunlop India Ltd, hit the upper circuit limit of 20 per cent and finished at Rs 11.68 on the BSE on Thursday. About 56,000 shares changed hands.

The BSE had suspended trading in the counter from March 29 after it received instruction from a liquidator, appointed by a single bench of the Calcutta High Court, to do so.

The exchange withdrew the suspension in order to make way for resumption of trading from Thursday following a Division Bench directive on Wednesday.

The Division Bench had, on March 29, asked the Single Bench-appointed “liquidator” to function as a “special officer” and not in a capacity as “provisional liquidator” in a winding up case, filed by a clutch of creditors.

According to analysts, trading resumption cleared some of the uncertainties pertaining to the stock.

“The Dunlop board proposed conversion of loan worth Rs 60 crore into equity worth Rs 50 crore will actually lower promoter holding in the company and also reduce loan burden,” said a market insider.

Conversion details

The company has disclosed in the explanatory statement to the EGM (April 28) notice that the conversion is caused by three loan assignees who exercised their right to convert.

Dunlop is issuing five crore equity shares of Rs 10 each at Rs 12 a share for conversion of loan of Rs 60 crore on preferential basis.

The other proposal to be placed before the shareholders for reclassification of all “unissued 1,00,70,000 preference shares of Rs 100 each” to equity shares of Rs 10 each of the company, was also linked to the conversion proposal, the notice said.

The company clarified that after the issue, within 15 days from the EGM date, promoter holding in Dunlop would come down to 38.53 per cent from current 65.29 per cent.

The three entities, which would get their assigned loan converted, would fall in the public category. The original loan, however, was obtained from a group entity.

jayanta_mallick@thehindu.co.in

Published on November 15, 2017

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