Companies and stocks to track today: August 31, 2020

KS Badri Narayanan | Updated on August 31, 2020

Scrips likely to see action today

Will CEO selling shares impact RBL Bank?

Vishwavir Ahuja, Managing Director & CEO of RBL Bank, sold 18.92 lakh shares of the Bank on August 27 and 28 for about ₹38.52 crore.

The sale has been driven primarily by the need to extinguish personal debt obligations and related servicing burden, undertaken over the past few years mainly to exercise and purchase vested ESOPs (and pay associated tax), as well as to take care of some pressing family commitments.

The sale represents approximate 18 per cent of Ahuja's and his family's total holdings. Ahuja continues to retain 80,10,000 shares (accounting for about 1.6 per cent holding) of RBL bank after the sale of these shares.

Additionally, 23 dIrectors or directors' relatives hold a 2.95 per cent stake in the Bank.

Analysts will closely monitor the impact of the selling by the top honchos.

Interest default may hurt Reliance Cap and other ADAG stocks

Reliance Capital has defaulted on interest payments totalling ₹5.42 crore to Housing Development Finance Corporation (HDFC) and Axis Bank. In a notice to the stock exchanges, the company said it had defaulted on interest payment of ₹4.71 crore to HDFC and ₹71 lakh to Axis Bank.

It had borrowed ₹524 crore as principal from HDFC and ₹100.6 crore from Axis Bank.

The delay in debt servicing is due to a prohibition on the company -- which cramps its capacity to dispose of, alienate, encumber either directly or indirectly or otherwise part with the possession of any assets -- pursuant on a November 20, 2019 order passed by the Delhi High Court…,” it said.

Following the proceedings initiated by Vistra ITCL (India) Ltd, the Debts Recovery Tribunal, through its order of December 3, 2019, has also prohibited it from transferring, alienating, encumbering or otherwise parting with the possession of assets owned by the company, it added.

As on July 31, it had ₹673.76 crore total outstanding borrowings from banks and financial institutions.

The development will affect not only Reliance Capital shares, but other Anil Dhirubai Ambani group stocks such as RPower, RInfrastructure, RCom and Reliance Naval

USFDA warning may inject selling pressure on WIntac

Wintac is in the cross-hairs of the US Federal Drugs Administration. The Injectable and ophthalmic manufacturing facility of the company at Nelamangala, Bengaluru, was inspected by the USFDA in February 2020, which had then issued five observations (483s). The company had responded to the observations.

However, the USFDA has now said that the reply in respect of two observations are inadequate, and it has therefore issued a warning letter. The company claims it is taking steps to address the issues covered in the warning letter and is confident of resolving them.

"The concerns raised are not related to any specific product, data integrity or product quality and the issues raised are more general in terms of technology/facility," it said in a notice to the stock exchanges.

The warning letter issued to the Company indicates that the FDA may withhold approval of any new drug applications. However, the current commercial supplies would be continued without any disruptions for the already approved products, it further said.

Key Results: Bharat Dynamics, NHPC, Arvind, Dredging Corp, Spandhana Sphoorty, GNFC, JK Cement, Pricol

Over 125 companies will declare their quarterly results for the quarter ended June 2020; some among them some will announce results for the April quarter. Some of the prominent companies that will declare their results are Amforge, Arvind, Auro Labs, BAG Films, BF Utilities, BPL, Bharat Dynamics, Dredging Corp, Dynamatic Tech, GNFC, Indosolar, JK Cement, Jai Corp, Lotus Eye Care, Jindal Poly, Morepen Lab, Mukand, Mysore Petro Chemicals, NHPC, Prakash Ind, Prozone Intu Properties, Pricol, Setco Auto, Prakash Pipes, Rushi Decor, Sadbhav Infra, Speciality Restaurants, Shree Renuka Sugars, Spandhana Sphoorty Financial, Uniply Decor, Uniply Industries, Valson Industries and VLS FInance.

CHD Chemicals likely to shine on order win

CHD Chemicals, which has been expanding its business throughout South-East Asia, has bagged an export order for chemicals worth ₹56 crore (about $7.5m). For business expansion, the company has formed an association with the leading group in the region. The order will help the company establish its base in global markets and increase its turnover as well as profitability, it said in a notice to the BSE.

The company has posted a profit of ₹15 lakh and turnover of ₹23.56 crore for the quarter ended March 2020. For FY20, its PAT stood at ₹0.53 crore and revenues at ₹86.51 crore.

Shares may attract buyers following the order win, though investors will closely monitor its execution of the order.

Nitco in focus after sale of its arm for ₹2.75 crore

Nitco has agreed on sale of the entire shareholding held by the company in New Vardhman Vitrified Private Limited (NVVPL). The consideration received from the disposal is ₹2.75 crore, it said in a statement to the stock exchanges. Following the deal, NVVPL would cease to be subsidiary of the company from the date of completion of the sale, it added.

Ashwin Babu Patel, Viral Chuni Ghodasara and Shekhar Rati Adroja are the buyers of the subsidiary, which had a negative net worth of ₹10.37 crore as of March 2020.

The deal is expected to be completed within 180 days from August 29.

The tiles firm had reported a loss of ₹34.23 crore for the quarter ended June 2020, on revenues of ₹23.08 crore.

Shareholders will closely monitor further developments.

Published on August 31, 2020

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