SP Tulsian of sptulsian.com told CNBC-TV18, “The deal (likely selling of IT services unit) is certain. I think the deal of Polaris should get consummated in the next couple of weeks. It is not wise to enter into the stock now because Rs 140 is its fair value capped on the upper side.”
He further added, “In the past, whenever these things happened in Piramal Enterprises or Stride Arcolab, where the company got huge money by hiving off their 70-80 percent business, they haven’t rewarded the shareholders in the form of distribution of hefty dividend. Similar case may happen here too.”
“The company (Polaris) already has Rs 250-300 crore as cash. It is a debt free company and if they are able to take about Rs 1,500-1,800 crore, net of taxes. From this, one can not really reward the shareholders.”
“At Rs 140, the market cap is Rs 1,500 crore against which the cash and cash equivalent is about Rs 2,000 crore. So that price seems to be fair price. Those who are holding the stock, I will advice them to exit now,” Tulsian said.
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