Jaiprakash Associates zooms 9% after Jhunjhunwala's Rare Enterprises buys 3 crore shares

Investor Rakesh Jhunjhunwala poses for a picture at a balcony overlooking Mumbai's financial district June 8, 2012. India's best known stock investor, billionaire Jhunjhunwala, doesn't much like the moniker of 'India's Warren Buffett'. Much like the famed Omaha investor, Jhunjhunwala has made a fortune from some savvy investments - Forbes magazine puts his net worth at $1.1 billion, ranking him 41st on India's rich list - but the similarities end there. Picture taken June 8, 2012. Image: REUTERS

Shares of  Jaiprakash Associates zoomed 9 percent to close at Rs 20.90 on Friday as RARE Enterprises has bought 3 crore shares of the company.

Big Bull Rakesh Jhunjhunwala’s RARE Enterprises has picked up 3 crore shares of Jaiprakash Associates at an average price of Rs18.37 on Thursday, NSE bulk deals data showed.

The investor first bought shares of Jaiprakash Associates in the year 2017. The shareholding pattern for the quarter ended June 2017 showed that he picked up 2.5 crore shares, amounting to 1.03 percent stake in the company. However, he later pared the stake below 1 percent.

Shares of Jaiprakash Associates remained in limelight throughout the trading session as investors cheered developments around the bid for Jaypee Infratech. The stock closed 17.48 percent higher on the BSE at Rs 19.15.

The stock has fallen nearly 36 percent so far in the year 2018 after registering over a 200 percent rally in the calendar year 2017.

JP shares picked up momentum after Moneycontrol reported that details emerging from Wednesday's meeting of the committee of creditors seem to indicate that Adani Group may be entrusted with the task of completing the unfinished flats of the realty company, besides ensuring that lenders face minimum haircut.

The bidders had to submit revised bids by Wednesday and also make presentations to the committee of creditors.

Sources told Moneycontrol that going by the fresh bids and the interaction between the suitors and the lenders, the Ahmedabad-based group had nosed ahead of the other three contenders — a joint venture (JV) of Singapore’s Cube Highways and Kotak Realty Fund, Sajjan Jindal’s JSW Group and Lakshdeep Investments which is part of Sudhir Walia’s Suraksha Asset Reconstruction Company.

The successful bidder will displace Jaiprakash Associates as the parent of Jaypee Infratech. As its promoter, the bidder would have to hand over completed properties to the buyers while settling dues with the banks on mutually agreed terms. It will also come to own the Yamuna Expressway and the Jaypee Hospital.

Adani Group is offering about Rs 2,500 crore-Rs 3,000 crore to the lenders and Rs 1,500 crore to finish the completion of the under-construction properties, an offer the creditors seem amenable to.