Wheels India gains on rights issue proposal

Wheels India rose 1.86% to Rs 770 at 10:46 IST on BSE, after the company's board of directors proposed to issue shares to public shareholders on rights basis to comply with the minimum public shareholding requirements.

The announcement was made after market hours on Wednesday, 11 December 2013.

Meanwhile, the BSE Sensex was down 132.85 points or 0.63% to 21,038.56

On BSE, so far 5,273 shares were traded in the counter as against average daily volume of 7,311 shares in the past one quarter.

The stock hit a high of Rs 778.90 and a low of Rs 760 so far during the day. The stock had hit a record high of Rs 967 on 17 December 2012. The stock had hit a 52-week low of Rs 584.50 on 28 March 2013.

The small-cap stock outperformed the market over the past one month till 11 December 2013, rising 8.79% compared with the Sensex's 3.32% rise. The scrip had also outperformed the market in past one quarter, rising 10.27% as against Sensex's 5.87% rise.

The company has equity capital of Rs 9.87 crore. Face value per share is Rs 10.

Wheels India said that the company's board of directors proposes to pass a resolution(s) by Circulation on 16 December 2013, inter alia, to consider the issue of equity shares on rights basis to comply with the minimum public shareholding requirements applicable to the company, by way of a rights offering to the public shareholders of the company with the promoters and promoter group shareholders of the company foregoing their rights entitlement, as permitted by the Sebi.

Promoters owned 91.44% stake in Wheels India (as per the shareholding pattern as on 30 September 2013). Promoter shareholding in private companies is not allowed to exceed 75% i.e. minimum public shareholding of 25% to comply with Sebi norms.

Wheels India's net profit rose 1.5% to Rs 8.73 crore on 5.3% fall in net sales to Rs 424.39 crore in Q2 September 2013 over Q2 September 2012.

Wheels India is engaged in manufacturing of steel wheels for commercial vehicles, passenger cars, utility vehicles, agricultural tractors and construction equipment.

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