Ipcl Scrip Tumbles Amid Glut Fears

History of sorts was made in the Indian stock markets today when the price of a stock tumbled by more than 20 per cent in one trading session. The Indian Petrochemicals Ltd (IPCL) counter lost about 32 per cent on both the Bombay Stock Exchange (BSE) and the National Stock Exchange (NSE). It closed at Rs 74.10 as against its previous close of Rs 108.75 on the BSE amid volumes of around 660,000 shares. On the NSE, the counter saw volumes of 7.244 million shares.

The stock plunged amid concerns that the shares rejected in Reliance's 20 per cent open offer would come up for sale in the secondary market. The Reliance open offer for IPCL was at Rs 231 per share whereas the ruling market price was below Rs 155 through the duration of the open offer.

 

Reliance today said it would accept 49.6 million shares of IPCL as per the terms of the open offer to acquire an additional 20 per cent equity at Rs 231 per share. Reliance will return 37.7 million shares.

Reliance received over 87 million shares, an oversubscription of 76 per cent. However, as per the terms of the open offer, it will accept about 57 per cent of these tendered shares.

In a media release, Reliance said, "For all the accepted shares under this open offer, remittances towards payment consideration are expected to be despatched to all the investors, except in cases where the Reserve Bank approval is awaited, by September 2, 2002, as against the scheduled date of September 21, 2002, as per the terms of the offer. This is within nine working days of the closure of the offer, the fastest remittance by any corporate in the country."

The unaccepted shares held in the demat form are expected to be credited back to the beneficial owners