Suzlon announced a rights issue at Rs. 63 on 10 June while market price was 54. This inspite of the company reporting losses for last few quarters and an order book that is depleting.
Suzlon promoter holding is 56 percent. Therefore, why was the rights priced so high, as promoters have controlling stake. Either this indicates that Tulsi Tanti knows and expects some great news which no investor has a sense of. Or the condition of the company may be worsening and Suzlon is trying to pass off a PR stunt by indicating that they are very positive on the future and trapping investors.
Food for thought is also that COO Sumanth Sinha has quit recently and has started a financial consulting firm with Suzlon as his first client.
Well if one thinks as an institutional investor it makes no sense to buy as operating environment for the company is still weak. However if one thinks like a pure day trading speculator, one may just go long at CMP of 55 and play for the fact that some great news is expected and stock may fly to 63 in no time!
Take your pick!
No comments:
Post a Comment