Parvinder Sheds 3% In Ranbaxy At Discount

Ranbaxy promoter Parvinder Singh yesterday offloaded 3 per cent of his stake in the company at a discount of about 5.5 per cent to the prevailing market price through a secondary market transaction.

Nearly 10 lakh Ranbaxy shares were sold through a negotiated trade on the National Stock Exch-ange yesterday at a price of Rs 650, against the market close of Rs 696.35. The value of the transaction works out to Rs 65 crore. The shares were said to have been bought by domestic institutions and banks.

The scrip opened on the NSE at Rs 697, which was also its intra-day high, and touched a low of Rs 692 before closing at Rs 696.35 against the previous close of Rs 687.85. The total value of trades in the stock was Rs 66.83 crore.

 

According to sources close to the deal, over 35 lakh shares held by Ranbaxys promoters are expected to be offloaded over the next few trading sessions.

The deal, worth Rs 65 crore, was reported yesterday. Another four to five lakh shares are expected to be unloaded today in the market. The stock has been bought by domestic FIs. The remaining lot of shares will be sold to foreign institutional investors in the next few days, the sources said.

The money is being raised by the promoters to retire high-cost debt, taken to subscribe to the warrants from Ranbaxys 1993 global depository receipts issue.

JM Financials was offered the mandate for offloading 7 per cent of the promoters stake in

Ranbaxy last December. Parvinder Singhs original plan to offload his equity through a special purpose vehicle had run into rough weather due to objections by the government and other institutions.

Sources at JM Financials said the discount to the market price indicated the confidence of investors in the company. The discount at which the trade took place and the market price indicates that institutional investors are taking a long term view of the company. It does not mean any lack of confidence, the sources added.

Parvinder Singhs stake in the company is expected to now come down to 32 per cent. Singh earlier expected to raise around Rs 245 crore through the sale of 35 lakh shares. However, at a price of Rs 650, he will receive only Rs 227.50 crore.

Unit Trust of India and other mutual funds hold about 14 per cent in the company while about 24 per cent is held by the public. The rest is held by banks, FIIs and other domestic institutions.