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July 28, 2001
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Money > Business Headlines > Report July 28, 2001 |
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RIL, HDFC placements profitable for UTIBS Markets Bureau Reliance Industries Ltd's private placement of shares, valued in 1994 at Rs 3.86 billion, and HDFC's placement of Rs 2.03 billion worth shares in the same year remain profitable investments for the Unit Trust of India, top sources with the fund major said. UTI's investment in Reliance Industries is valued at Rs 14.84 billion (as on June 29, 2001) showing a notional profit of Rs 7.11 billion. UTI had picked up a huge chunk of Reliance Industries at a price of Rs 201.25 (adjusted price) on October 21, 1994, and the stock is now valued Rs 369.50. UTI had picked up the HDFC stock at Rs 320 on August 4, 1994, and with the stock being quoted at Rs 689.50 as on June 29, 2001, UTI is sitting on profits of Rs 2.80 billion. UTI's strategy on private placements has come in for questioning after its Rs 321 million private placement deal in Cyberspace led to substantial losses. But sources said, except for a few transactions, which have resulted in huge profits, a large number of private placements have led to massive losses. According to an internal calculation, as at the end of June 29, 2001, some of these dud stocks are either trading below par value or not trading at all. For instance, Hanil Era, where UTI made a private placement of Rs 190 million at Rs 75 per share, is now trading at Rs 2; Mangalam Cement (Rs 200 million at Rs 85 per share) is now trading at Rs 4.90; Balkrishna Industries (Rs 210 million at Rs 210) was traded at Rs 20 -- but is not currently traded; Rajasthan Spinning & Weaving (Rs 240 million at Rs 160 per share) is down to Rs 2.90; Garden Cotton & Yarns (Rs 400 million at Rs 250 per share) is down to Rs 1.10; and, Mafatlal Industries (Rs 480 million at Rs 765) is now down to Rs 10.80. Other companies include Shonkh Technologies, JIK Industries, Soundcraft Industries, Sun Infoway, Baron International, Adni Export, Welwin Industries, Welspun, Emtek, D-Link and Klickforcotton.com. Powered by YOU MAY ALSO WANT TO READ:
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