I had earlier posted on Zenotech Labs laying down the original premise of the trade in a post here.
After much delay the supreme court judgement came and the court ruled in the favour of Daichhi and the minority shareholders lost the case. The open offer will now happen at Rs 113.6. The stock promptly corrected to the Rs 100 mark where I exited my position taking a loss of about 10-12% on the trade.
A bitter pill to swallow but the downside was factored in the trade in case the judgement came in favour Daiichi.
The stock has subsequently moved down to the Rs 94 level and at some point of time will start becoming attractive considering the high acceptance ratio on the open offer.
10 comments:
Not a bad trade at all given the risk reward at that time.Have you considered the fundamental valuation of the stock as well? Does it make sense to buy the stock at Rs 94.
How do you go about finding/analysing acceptance ratio information ?
Ninad,
I know this may sound like a newbie question to you, but how do you calculate the acceptance ratio on such offers? Would appreciate if you could link to an earlier post or an Internet write-up explaining the same.
Thanks,
Vivek
Hi Anon1
I m just waiting to see the timelines on the open offer and then take a call on the price at whichbuying the stock will make sense.
Cheers
Ninad
Hi Anon2 / Vivek
Acceptance ratio can be computed by looking at the % of residual shareholding other than the person making the open offer. So the acceptance ratio will be 20%/ on the residual shareholding.
There is element of subjectivity in the prcoess in terms of ascertaining what % of the residual shareholder will tender to the offer.
Regards
Ninad
Thanks for the explanation Ninad. It makes sense now. For Zenotech, the acceptance ratio works out to ~38% assuming all shareholders tender their shares. Based on your experience in these sort of investments, do you think its a healthy enough ratio to see the open offer through?
(I do understand there are other risks involved like time risk. As far as further litigation risk goes, I believe the promoters aren't interested in pursuing the case in courts any further).
Vivek
Dear Ninad
I had done a trade in zenotech during the period of feb-march and made a profit of around 7 %, i would have had hold onto the postion, but whereby i was not convinced from inside of getting a rate of 160 and i exited.
But as you said now, iam planning to reenter the stock for the open offer,according to you what would be the right price
Dear Ninad,
I am also finding the opportunity itneresting. But not sure of it.
have come across a link:
http://umcapitalindia.blogspot.com/2010/07/zenotech-labs-cmp-rs-92-looks.html
Regards,
1980's was the year when [B][URL=http://www.salethomassabo.com/thomas-sabo-halsschmuck.html]Thomas Sabo Schmuck[/URL][/B] introduced his jewelry. Work may be place in to produce pure ornaments in silver with fantastic high quality, which outcomes [B]Thomas Sabo[/B] in formatting it is outstanding fashion. The two most classical sequence by Thomas Sabo; [B][URL=http://www.salethomassabo.com/thomas-sabo-halsschmuck.html]Thomas Sabo Schmuck[/URL][/B] Club and silver Series have been created and bring in fresh pieces of designs. Its stated about [B][URL=http://www.salethomassabo.com/thomas-sabo-charms.html]Thomas Sabo Charms[/URL][/B] that they represent our craze and obsession. In case you wish to produce a individual feel good and look distinct amongst the [B]Thomas Sabo schmuck[/B] crowd, this is a ideal way to do so.
From the [B][URL=http://www.salethomassabo.com]Thomas Sabo Onlineshop[/URL][/B] collection you can find charms representing the birthstone for each month. [B]Thomas Sabo onlineshop[/B] are and can certainly sparkle everywhere you go. [B][URL=http://www.salethomassabo.com]Thomas Sabo[/URL][/B] indicators may also be added to this. Their charms are produced in the [B]Thomas Sabo onlineshop[/B] type and every a person is made to present the distinct identity of each and every sign.
[B][URL=http://www.salethomassabo.com/thomas-sabo-halsschmuck.html]Thomas Sabo Schmuck[/URL][/B] offers a large range for virtually anyone and there are unique types of pendants, rings, necklaces along with other pieces of [B][URL=http://www.salethomassabo.com]Thomas Sabo[/URL][/B] to choose from.
Intresting articles.
Regards
Vikram
www.bewareinvestor.blogspot.com
Post a Comment