Monday, July 18, 2011

Cals Refineries - What the Latest Share Holding Pattern Reveals

Cals Refineries' (BSE: 526652) latest Share Holding Pattern (SHP) has been made available to investors. StockExplain could source this SHP from some investors today. The principal highlights of this SHP for the quarter ending June 2011 is that a Hardt Group affiliate, Abboro Ltd, has taken 1.46% stake in the company, and that the number of shares held by FIIs have gone up by 4.33%.

The equity participation by Hardt is via a preferential issue and cash infusion, and is supportive of a larger deal in which Hardt is supplying two used refineries to Cals Refineries in lieu of a much larger equity stake. This larger allotment would be via a GDR, permission for which is now pending from India's Cabinet Committee for Economic Affairs (CCEA).

However, this Share Holding Pattern reiterates the fact that Hardt is not participating in this project as a promoter. It should be recalled that the Vienna headquartered Hardt Group's Founder & CEO Dr. Alexander Schweickhardt is an Independent Director of Cals Refineries.

The promoter's stake, or promoter's contribution, which had been an unsatisfactory factor for long in Cals Refineries' ownership pattern, has seen some changes this quarter. Nyra Holding, a promoter group company has upped its stake through a recent preferential issue, and the promoter holding in Indian shares of Cals has improved from 2.43% in March 2011 to 2.92% by June 2011, that is, by a factor of 0.49%.

However, together with the issue of shares to Hardt, this has contributed to a slight dilution to existing stakes. For example, promoter stake in Cals' GDR is down by 0.28%, even though Cals' promoters didn't offload and sell any GDR during the quarter.

Including the GDR, the total promoter's stake in Cals Refineries is now 16.3%. 

The investment in new shares by promoters and Hardt at more than double the market rate can appear strange at first, but, the rationale behind this is to bring in fresh money into the project. Cals Refineries has been cash-strapped for some years now.

The non-promoter holding of the existing GDR continued to face selling pressure in this quarter too, with it falling from 18.59% in March to 16.41% by June, a fall of 2.18%. This was possibly effected through GDR conversion (offloading) and sell-off in the Indian market, as well as the dilution.

Another segment of investors, where Cals Refineries has historically found better patronage - Foreign Institutional Investors - fared better this time also, with FII participation improving slightly from 3.05% in March to 3.11% in June. Though the rise seems small, it is in fact much more significant, as it happened by offsetting the dilution. In real terms, FII participation rose by 4.33% or 1.07 crore shares.

The stake of a long-standing FII in Cals, Taib Securities Mauritius Ltd, stands slightly reduced from 1.44% in March to 1.41% in June, purely due to the dilution.

Neelam Ramniklal Dedhia, probably a High Networth Individual (HNI) or stock broker, upped personal stake in Cals Refineries from 1.33% in March to 1.53% in June. The real rise is, of course, higher as it happened by offsetting dilution.

Dedhia, Hardt Group (through Abboro), and Taib Securities, are the only three public non-promoter investors in Cals, who holds more than 1% of the equity each.

Number of public shareholders in Cals continued to rise, with the number of investors holding over one-lakh shares, as well as number of investors holding less than one-lakh shares both registering growth. The surge was more marked in the over one-lakh category, signalling continued interest by larger retail investors. Bodies Corporate, which denotes non-individual public shareholders, also witnessed a surge in numbers, and a slighter improvement in total holdings.

Taken overall, the new Share Holding Pattern of Cals Refineries published today doesn't contain any new negative signals for retail investors, and can even be taken as a reasonable positive signal due to Hardt's entry, as well as on the fact that FIIs interest has gone up. Retail interest, including that of individuals and corporate entities continue to be healthy.

Cals Refineries closed trading today on a strong note, with price surging by 6.38%, and volumes more than 4.5 times the average volume of the past two weeks.

1 comment:

  1. How long should we be expecting the CCEA approval to take place.
    Any hitches in this matter?
    Thanks for the fantastic analysis,keep up the good work pls.