CESC slumps after board OKs restructuring

CESC fell 16.51% to Rs 816 at 15:26 IST on BSE after the company announced a restructuring scheme.

The announcement was made during trading hours today, 18 May 2017.

Meanwhile, the S&P BSE Sensex was down 230.19 points, or 0.75% to 30,428.58.

On the BSE, 5.81 lakh shares were traded in the counter so far, compared with average daily volumes of 42,325 shares in the past one quarter. The stock had hit a high of Rs 990.20 and a low of Rs 812 so far during the day. The stock hit a record high of Rs 1,001.85 on 16 May 2017. The stock hit a 52-week low of Rs 531.35 on 2 June 2016.

The stock had outperformed the market over the past one month till 17 May 2017, rising 13.77% compared with 4.57% rise in the Sensex. The scrip had also outperformed the market in past one quarter, rising 14.35% as against Sensex's 8.33% rise.

The large-cap company has equity capital of Rs 132.56 crore. Face value per share is Rs 10.

CESC said that its board announced a restructuring scheme. The scheme includes amalgamation of CESC Infrastructure, Spencer's Retail and Music World Retail with CESC. The scheme also includes demerger of power generation undertaking to Haldia Energy; demerger of retail undertaking I (as defined in the scheme) of the company and retail undertaking 2 (as defined in the scheme) of Spencer's Retail to RP-SG Retail. Further, the scheme includes demerger of IT undertaking of the company to RP-SG Business Process Services.

The scheme includes amalgamation of Spen Liq with RP-SG Business Process Services. The scheme also includes amalgamation of New Rising Promoters with Crescent Power.

The scheme includes reduction and cancellation of the existing share capital of Haldia Energy, RP-SG Retail and RP-SG Business Process Services. Further, it includes reduction of the face value of the equity share of CESC from Rs 10 per share to Rs 5 per share and subsequent consolidation of two equity shares of the company of Rs 5 each into one equity share of Rs 10 each.

Further, the equity shares of Haldia Energy, RP-SG Retail and RP-SG Business Process Services will be listed on Calcutta Stock Exchange, BSE, and National Stock Exchange of India, post effectiveness of the scheme. The shareholders of the company will get shares in these listed companies in the same proportion as their holding in the company.

Post restructuring, in addition to the IT undertaking, the RP-SG Business Process Services will house various other ventures of the group, inter alia, property, entertainment and fast moving consumer goods business. As part of this alignment investments in/by Guiltfree Industries and Apricot Foods will also be held by RP-SG Business Process Services.

Meanwhile, the company announced its Q4 March 2017 results during trading hours today, 18 May 2017. CESC's net profit rose 0.68% to Rs 295 crore on 8.44% increase in net sales to Rs 1631 crore in Q4 March 2017 over Q4 March 2016.

CESC is a fully-integrated electrical utility company. The company's other business segments include power, organized retailing, property development and business process outsourcing.

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