Wednesday, September 22, 2010

VIMAL OIL AND FOODS - UPDATES

I have received lot of queries regarding the open offer made by the existing promoters of Vimal oil and foods @ Rs.51/-. As per the prevailing law, promoters can hike their stake through creeping acquisition method upto 5% in each financial year .But in this case they have  pumped an amount more than  Rs.30 Cr by subscribing 60 lac equity shares at a price of Rs.50.16/- through preferential issue . This is  way above the limit of 15%(upto open offer not applicable).Hence as per the rule ,it is a mandatory open offer. Since the market price is above open offer price ,chances are low to get shares in this offer till market price ruling above the open offer price . This means ,open offer @ Rs.51/- is not a reason to come down the share price to this level in any way.On the other side ,this development is really a positive one.Promoters are bringing huge money to the company itself is a sign of their confidence .This amount is expected to partly used for reducing debt  and balance for further business development ,which is positive for the company in the long run
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This is to clarify some doubts raised by some readers as comments and through e-mail.

6 comments :

  1. Sir,

    Your view on BAG Film and Media? It is tarding at year low Price. Can i invest with 6 months timeframe

    Thanks

    ReplyDelete
  2. For significant improvement in financials ,you may need to wait atleast two years.May get only a small bounce in share price from current level- in short term

    ReplyDelete
  3. Thanks..for the quick response...sir.

    ReplyDelete
  4. hello sir. i am following your blog for some time now. i must say that this is a finest blog in this genre.
    thank you so much for educating and directing all of us.

    ReplyDelete
  5. sir can i buy this stock

    ReplyDelete

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