Sintex: Who is really buying?
The non-promoter, non-institution shareholding is up sharply to over 40 percent vs little over 27 percent. In fact individuals now own 8.3 crore shares vs 5.5 crore shares. But what is really perplexing is the category called "Bodies corporate".
November 07, 2013 / 10:30 IST
Sintex stock is up 72 percent this month and what is truly amazing is that the stock has started to rally right after September 30, which is end of the quarter. So what exactly happened in Q2 and what has happened since?
I am just looking at the recent shareholding pattern changes. In quarter ending September 30, FIIs held 3.7 crore shares or 11.82 percent of equity, which is remarkably lower than 7.8 crore shares or 24.8 percent of equity they held at the end of June quarter. And what really amazes me is that this was not bought by either mutual funds or other domestic financial institutions whose total shareholding is almost flat between quarters. And the promoter shareholding didn’t change as well – so who really bought?(Also Read: Sintex surprises street, Q2 net profit up 0.7% at Rs 73 cr)The non-promoter, non-institution shareholding is up sharply to over 40 percent vs little over 27 percent. In fact individuals now own 8.3 crore shares vs 5.5 crore shares. But what is really perplexing is the category called "Bodies corporate". Their shareholding is up to 4 crore shares versus 2.8 crore shares. That's a jump from 8.9 percent to 12.9 percent. Who are these corporate bodies and individuals? None of them holds over 1 percent stake and hence it’s not shown in the breakup of shareholding pattern, but if the grapevine is to be believed, we have seen a lot of smart/informed buying by certain blue blooded investors. By the way, promoters also bought 25 lakh shares between October 17 and 18 and they made a proper disclosure to that effect. From those levels, the stock is up 50 percent!Now Q2 numbers looked good for Sintex, but the balance sheet is still in a mess. In fact from the same shareholding pattern, you see Bank Of Newyork holding 10.2 cr shares as a trustee for USD 140 m FCCB due in 2017. Now 10.2 crore shares are worth 350 crore and USD 140 m FCCB amount to Rs 870 crore. So there is still a lot of risk that this company is carrying.What to do now with the stock? Well, if you managed to get in early, there is no harm in booking say 35-40 percent of your holding which might cover your entire costs and make some money as well and ride the rest with a strict trailing stop loss. But if you have missed the bus, wait for the next bus – don't try to catch this one. Discover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
