image courtesy/ hindustan times
Slow down if you are planning to invest in the stocks of DHFL as they are set to be delisted, after Piramal Capital and Housing Finance Ltd acquired it. Warning that the DHFL stock may be written down to zero soon, authority have even suggested investors who currently hold the shares to exit and book whatever their profit or loss. The DHFL shares were sealed in a 10% upper circuit on Tuesday, but this was accredited to lack of sellers.
India’s largest brokerage firm Zerodha warned investors that the value of DHFL shares may be written down to zero. “Equity shares of DHFL are likely to be extinguished as part of acquisition of the company due to NCLT’s insolvency process. There can be a significant risk of you losing your entire investment by trading in this stock,” the firm tweeted.
The Mumbai bench of NCLT ruled out that Piramal Group’s ₹37,250-crore bid for the firm was followed and, “Resolution applicant’s amount to remain the same. Only inter-se allocation to be reconsidered.” It has also asked DHFL’s committee of creditors to consider giving more money to small fixed deposit holders.
The Piramal Group’s offer includes ₹12,700 crore in upfront cash, ₹3,000 crore in interest income on DHFL’s books and ₹19,550 crore worth of non-convertible debentures to be repaid over 10 years.
In the statement on Monday it also added that, “We are pleased with the judgment today by the NCLT for approving our resolution plan for DHFL. This follows the endorsement of 94% of lenders, and the subsequent approvals from RBI and Competition Commission of India, and reiterates the strength and quality of our bid.”