Trying to ride the speculative horse could prove to be a costly misadventure as investors in the multi-national pharma company AstraZeneca Pharma India Ltd realised on Tuesday.
While speculation about delisting of shares by the MNCs at a hefty premium to the prevailing market price has been doing the rounds of late, particularly after Alfa Laval (India) Ltd came out with an attractive delisting offer, investors are often caught on the wrong foot.
The delisting fervour has caught up with the investors since the law requires that public limited companies should have at least 25 per cent public shareholding if they want remain listed. In AstraZeneca Pharma India, the promoters' holding is 90 per cent and it has two options – either shed the promoters' stake or delist the company from the Indian bourses.
Companies that have promoter holding over 75 per cent have time till June 2013 to comply with the regulations.
In both the exchanges, the stock hit its 52-week high. On the BSE, the scrip surged to a year-high of Rs 2,489 and on the NSE, it touched its 52-week high of Rs 2.488.70. But the euphoria generated proved to be short-lived after the company came out with a denial.
In a communication to the stock exchanges, APIL clarified that the “company has received no communication what so ever” from its overseas promoter shareholder AstraZeneca Pharmaceuticals AB, Sweden, on delisting of shares.
The denial sent the stock price crashing in both the exchanges. While the price sank to Rs 2,094 on the BSE, on the NSE the stock slumped to Rs 2,099 at close, resulting in a near 20 per cent fall from the day's high. While the trading volume on the NSE was 2.48 lakh shares, on the BSE the volume was 1.38 lakh shares.
ryn@thehindu.co.in