Had started investing in the counter from 180 levels, didnt get an opportunity to post it....
Please share your comments and suggestions regarding Timken India
had a look at the counter as a delisting candidate vis-a-vis phenomenal spurt in the volumes in month
Valuations - as per relative valuations it is the most expensive among its peers SKF and FAG
In a nutshell,
Please share your comments and suggestions regarding Timken India
had a look at the counter as a delisting candidate vis-a-vis phenomenal spurt in the volumes in month
- Global experience – Annual report shows List of subsidiaries showing ~69 subsidiaries worldwide out of which only 2 of them incl India are listed
- 80% sh holding has to be brought down (because of the 25% public float norm)
- 3 yr window for companies to comply with 25% sh holding norm - No hurry for mgt, however with their expansion plans they might have to shell out more later
- Shifted entire India holding via Mauritius in 2010
A few unanswered questions - Mgt shareholder unfriendly or other plans ???
- 200cr lying in Balancesheet in Income Funds - why not being distributed as dividend or (is it being kept for delisting??)
- Capex happening thru Timken Chennai which is 100% held by Timken... Timken Chennai to do contract manufacturing for TImken India
- http://smartinvestor.in/market/Smartmoves-68925-Smartmovesdet-Timken_plans_Rs_200_cr_capex_to_meet_wind_cement_sector_needs.htm
- http://www.moneycontrol.com/india/messageboardblog/message_thread/4399321/6199321
- Ploy to shift profits to 100% subsidiary or prevent further developments in Timken India till it is delisted
- Ward timken (Chairman Timken) talks about delisting or diluting its stake- Apr 11, 2011
- http://lite.epaper.timesofindia.com/mobile.aspx?article=yes&pageid=6&edlabel=ETBG&mydateHid=13-04-2011&pubname=&edname=&articleid=Ar00602&format=&publabel=ET
- http://www.moneycontrol.com/india/messageboardblog/17/36/message_thread/4501670/6301670
- No denial by mgt like last time in June2010 - However why would mgt preempt notice of delisting (if any) - it will only lead to higher payout from their side for delisting??
Valuations - as per relative valuations it is the most expensive among its peers SKF and FAG
Sh Holding Pattern - easily doable
- 80.02% holding - so out of the balance open offer of 19.98, they will require to get atleast 50% i.e. 9.99%
- 4.72% with Institutions
- 1.57% body corporates
- 0.64% individuals holding >1 lakh Rs
- ignoring 0.19 held by NRI's - they can mop up - 6.93% from smart investors
- out of the balance 12.86% (held by public <1 lakh) +.19 clearing membes - 13.05% - they require 23% tender to get balance 3.06%
- HDFC, DSP Blackrock (acquisition price ~175 in nov-dec 2010) and UTI are invested
If you analyse the share holding distribution given in 31st Dec 2010 report
- A reverse cumulative calculation will show that holders between 500-1000 shares will almost complete the required ratio of 90%
- Balance <1% can be easily got from retailers holding b/w 1-500 shares
Movement in top 100 shareholder list in last one month
Previously top 100 shrhldrs held 86.4% shares whereas the number has increased to 86.9%. Moreover, if we look at the top 50 shareholders, very few have actually sold out
New names who have bought over last 1 month include Citigroup Mauritius with 2.9 lakh shares, Puneet & Yadu Dalmia of Dalmia Bharat Cement group holding 75k shares…
In a nutshell,
Unlike Binani - no significant group of shareholder alone can lead to delisting - without a good price on offer - delisting unlikely to happen
however Share price might continue to languish incase delisting gets delayed for the period of 3 years (more of time risk than event risk).
however Share price might continue to languish incase delisting gets delayed for the period of 3 years (more of time risk than event risk).
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