Equity dilution fear takes toll on Gujarat NRE Coke. Capital...

Equity dilution fear takes toll on Gujarat NRE Coke.

Capital Market / 01:46 PM , Sep 22, 2009

Gujarat NRE Coke fell 3.11% to Rs 66.90 at 13:45 IST on equity dilution concerns after the company said it is looking to raise funds through issue of securities. The announcement was made before trading hours today, 22 September 2009.

Meanwhile, the BSE Sensex was up 168.63 points, or 1.01%, to 16909.93. On BSE, 15.92 lakh shares were traded in the counter as against an average daily volume of 23.96 lakh shares in the past one quarter.

The stock hit a high of Rs 70 and a low of Rs 66.20 so far during the day. The stock had hit a 52-week high of Rs 71.40 on 16 September 2009 and a 52-week low of Rs 16.80 on 9 March 2009.

The stock had outperformed the market over the past one month till 18 September 2009, rising 31.02% as compared to the Sensex 11.35% rise. It outperformed the market in past one quarter, spurting 54.65% as against 17.35% rise in the Sensex.

The mid-cap coking coal producer has an equity capital of Rs 476.92 crore. Face value per share is Rs 10. The current price of Rs 66.90 discounts the company's Q1 June 2009 annualised EPS of Rs 0.31, by a PE multiple of 215.80.

Gujarat NRE Coke said its board will meet on 24 September 2009, to consider raising up to $60 million, or Rs 300 crore through issue of securities, including foreign currency convertible bonds (FCCBs). The board will also consider issuing 2.5 crore convertible warrants to promoters.

Meanwhile, the company's board recommended issuing one bonus share, with lower voting rights, for every 10 shares held in the company. Every 100 bonus shares will carry 1 voting right, compared with one voting right for every existing share.

Gujarat NRE Coke reported a 96.1% decline in net profit to Rs 3.64 crore on a 17.9% fall in sales to Rs 310.04 crore in Q1 June 2009 over Q1 June 2008.

Earlier in May 2009, the company's Australian unit, Gujarat NRE Minerals, had secured a $50 million long-term loan to support its coal mining facility in Australia.

Gujarat NRE Minerals is developing at its NRE No 1 Colliery three new roadways (for conveyor, rubber-tyred vehicles and track vehicles) into the Wongawilli Seam. The availability of the funds will ensure their progresses remain as per plan to ramp up total run-of-mine production to 7 million tones a year from the NRE No 1 Colliery and NRE Wongawilli Colliery by the year 2012-13, the company said.

Gujarat NRE Coke manufactures and sells low ash metallurgical coke. The company's plants are located in Dharampur, India.

Promoters of Gujarat NRE Coke have pledged 12.91 crore shares, or 27.09% in the company. The total promoter holding is 45.08% as on 31 March 2009

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