Warren Tea hits circuit filter

Jayanta Mallick Kolkata | Updated on August 08, 2011



The low-float stock has a history of sudden bursts of activity

The BSE-listed Warren Tea Ltd has been touching new highs and hitting the circuit filters despite markets across the globe under a bear grip. The Bombay Stock Exchange, taking note of the sudden surge in activity, last Tuesday brought down the upper price circuit limit to 10 per cent from 20 per cent.

On Monday, the Warren Tea stock closed at Rs 606, after registering its all-time high of Rs 606.8 during intraday trade.

On August 31, 2010 the stock was at its year-low of Rs 149.

The circuit filter revision (implemented by the exchange in a routine manner) can theoretically lead the stock to trade-to-trade or in T-category. The low-float stock (only 16.49 per cent is held by public and none holds 1 per cent or above in this category as on June 30) has a history of sudden bursts of activity driven by a few Kolkata-based market operators.

Importantly, more than 50 per cent of the total number of shares (107,14,273) still is in physical form.

The promoters' holding has remained unchanged at 83.51 per cent at the end of the June quarter.

However, Bearita Holding Inc, a British Virgin Island registered outfit on the board of which by Mr Vinay Kumar Goenka, the principal promoter of Warren Tea, is the Chairman, sold its entire stake 13.32 per cent on July 6, according to an earlier statement. The unloaded shares were picked up by Mr Goenka and Mr Vivek Goenka on the same day. The story turns more curious if one takes into account the bulk deals of August 2 in which a total of 4.78 lakh shares changed hands. But those entities' name did not figure in the public category till June 30.

The recent trades did not clearly suggest that the promoters have been trying to decrease their holding to the regulator prescribed level.

If the August 2 deals are any guide, the total number of shares should reflect in the second quarter disclosure, which means theoretically after September 30.

Thursday's volume of 75,000 shares, down from its fortnightly average of 1.03 lakh shares gives a clue – traders and operators are at work.

Business Line's attempt over the past three days to have the company management's takes on the “mysteries” surrounding the trades and shareholding did not elicit any response.

Published on August 08, 2011

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