Last Updated : Dec 31, 2013 05:31 PM IST | Source: CNBC-TV18

Remain invested in UB Holdings: SP Tulsian

SP Tulsian of advises to remain invested in United Breweries Holdings.

SP Tulsian of told CNBC-TV18, "One can remain invested into United Breweries Holdings. We have seen the upper circuit today. Sometimes the market is taking a very optimistic call that UB Holdings will be retaining 7-8 percent stake which is going to get reversed from the Diageo deal, but the situation is that life is not so easy for United Breweries Holdings, because that is the promoter company for Kingfisher Airlines and the total exposure is about Rs 9,000-11,000 crore and we know that the winding up petitions which have been filed against the companies are all by the unsecured and secured creditors of Kingfisher Airlines. They stood as a guarantor. They have borrowed the money."

"They are holding these many investments. The market cap is very low at Rs 200 crore. Even if they will sell whatever number of shares and whether they mobilise Rs 5,000 crore, Rs 7,000 crore, no shareholders can really expect any kind of return from that sale proceeds that okay they maybe given a special dividend. Second point, whenever we see this kind of upmove coming in the exchange will really put this stock into the trade to trade category, because that we have seen many times in the past also happening," he added."

"One should remain invested. It is a matter of maybe couple of days, one may again see another 20 percent circuit tomorrow. This is definitely not a quality stock. You cannot take a fundamental call. If I want to say that okay they have the investments of Rs 10,000 crore and the market cap is Rs 200 crore, which is all irrelevant if you really consider the liability."

First Published on Dec 31, 2013 05:31 pm