Sintex Industries: Shareholders Bombard RP with Mails against Delisting Proposed by Winner Reliance-ACRE Consortium
Moneylife Digital Team 21 March 2022
While the committee of creditors (CoC) of Sintex Industries Ltd (Sintex)has approved the joint bid of Reliance Industries Ltd (RIL) and Assets Care & Reconstruction Enterprise (ACRE) to acquire the debt-ridden textiles company under the insolvency resolution process (IRP), dozens of shareholders have sent emails to the resolution professional (RP) against the proposed delisting of Sintex. Online brokerage Zerodha has also issued a warning to investors to refrain from buying shares of Sintex in the hope of earning a profit.
Sintex, in a regulatory filing Sunday, informed the exchanges that "As per resolution plan of RIL jointly with ACRE, it is proposed that existing share capital of the company shall be reduced to zero and the company will be delisted from the stock exchanges, BSE and National Stock Exchange (NSE)."
According to the company, the e-voting on approval of the resolution plan was concluded on 19 March 2022 and the resolution plan submitted by RIL-ACRE has been duly approved by 100% of CoC members under Section 30(4) of the Insolvency and Bankruptcy Code (IBC) as the successful resolution plan.
This, however, is subject to the approval of the National CompanyLaw Tribunal's (NCLT's) Ahmedabad bench.
Separately, Zerodha founder Nithin Kamat, in a tweet, warned investors against buying shares of Sintex just because it is at a 52-week low. He says, "It is concerning that we have a few customers still buying Sintex shares even after this nudge that the stock price will go to 0 and mandating a time-based one-time password (TOTP). There are so many who decide to buy just because a stock is at 52 week or all-time lows without caring about the reason."
Meanwhile, shareholders of Sintex have asked the RP for full disclosure about the proposed delisting plan. "... we are surprised to note that, so far, there has been no approval of the said resolution plan under section 31 of the IBC. Despite the above, you have made partial disclosure about proposed delisting in violation of the said SEBI guidelines without even disclosing the exit price justification; therefore, there has been a violation of the Securities and Exchange Board of India (SEBI) delisting guidelines," these shareholders say.
However, this is not the first time when shareholders of Sintex are sending emails in bulk to media. In January this year, a bunch of shareholders had demanded that since details of the bids have been leaked, it violates the principle of maintaining confidentiality during the entire resolution process.
Citing this ruling, shareholders of Sintex had requested the resolution professional to cancel the existing ongoing process immediately; invite fresh bids; debar the defaulting bidders—RIL and ACRE from the process. (Read: Sintex Industries Shareholders Demand Fresh Bids since Media Leak Violated Principle of Confidentiality)
As reported by Moneylife at that time, most of these shareholders are clueless that the insolvency resolution process allows a successful bidder to decide the fate of existing equity. Most investors have also been lured into investing only recently, based on two well-known examples of Ruchi Soya and Alok Industries where existing shares were not extinguished, giving shareholders a big bonanza.
Those who take blind bets based on social-media wisdom rarely bother with even the cursory research that would have informed them of dozens of examples where existing shareholders lost out when equity was extinguished. So compelling is the fake narrative that millions of investors are buying shares of bankrupt companies as evident from the trading volumes of stocks that are being actively manipulated.
They were not told that Bhushan Steel, Bhushan Power and Electrosteel Steel, Lakshmi Vilas Bank, Dewan Housing Finance Ltd (DHFL) and UVSL (Uttam Value Steel Ltd), among others, have been delisted after the equity was written off. Many investors were trapped in some of these companies. (Read: Many Ways of Being Fooled in a Bull Market)
RIL has been looking to diversify its business from petrochemicals to telecommunication, green energy and fashion. It has recently purchased IPR (intellectual property rights) to use the iconic Lee Cooper brand in India and acquired a stake in some other fashion brands. RIL is interested in Sintex since it had been a supplier to global brands such as Armani, Hugo Boss, Diesel and Burberry. RIL has also partnered with Burberry Group Plc, Hugo Boss AG and Tiffany & Co.
Since 1 January 2022, however, shares of the textiles company fell nearly 60%, data showed.
On 4 January 2022, Sintex hit its (adjusted) 52-week high of Rs20.45 on the BSE. However, since then, it is on a downhill journey. It remained at Rs7.82, down 5%, while the 30-share Sensex ended Monday 571 points down at 57.292.49 points.
Comments
irashachi
2 months ago
Please lodge your complaint on SEBI Complaint Redress System (SCORES) at https://www.scores.gov.in
or SEBI SCORES Mobile App which is available on both Apple App Store and Google Play Store.
elsonpathrose
3 months ago
I invest 127000 Rs. in Sintex industries. What I will do to get back my money?.
Is there any hope for listening it and we can sell it?
Please some one send a genuine answer...
thankimeet2011
Replied to elsonpathrose comment 2 months ago
[email protected] Or +91-9722335047 Ping me here!!
elsonpathrose
Replied to thankimeet2011 comment 2 months ago
How can you help me?
Kamal Garg
Replied to elsonpathrose comment 2 months ago
I think a broad contour of the Plan must be shared openly on this platform so that people can discuss it amongst themselves and decide whether they want to participate in some exercise which is being contemplated against Sintex Industries, its acquirer, CoC, NCLT , etc.
elsonpathrose
Replied to Kamal Garg comment 2 months ago
Thanks for your reply. If there is any development, please let me know. Appreciate your assistance..thanks
badhri9984
3 months ago
Olgirich of Modiji poor investors on the road.
ashish28007
3 months ago
Why shares are allowed to buy in the first place when the company has already decided that they will delist it from stock exchange.. isn't it a fraud?
sathishskp82
3 months ago
when the book value of sintex is positive, how could they do this, is there any legal angles to fight on this basis to protect our investments.
sanjay.spot2022
3 months ago
Can Justice SJ Mukhopadhaya help the shareholders of Sintex Industries. He had supported for Alok industries. Are shareholders taking initiatives to stop the delisting. Why do we get penalized.

Shri. Mukesh Ambani’s father Dhirubhai Ambani was very helpful to shareholders, and I believe his son Shri. Mukesh Ambani should continue his father’s Legacy to stand for shareholders.
Be good with shareholders and understand our situation and not allow delisting of Sintex Industries shares.
mmitesh.jobanputra
3 months ago
[email protected]

This is the email address of NCLT Ahmedabad bench
sanjay.spot2022
Replied to mmitesh.jobanputra comment 3 months ago
This email does not seem to be correct, is there any other email address.
babusharma1005
3 months ago
All are involved in this fraud NCLT/SEBI/RELIANCE and Govt also. NCLT and SEBI are not for retail investor, they only work for corporate and DALAL of corporate houses.
sanjay.spot2022
3 months ago
Let us appeal to NCLT and make them understand the share holders should NOT be penalised by delisting the Sintex Industries shares. Can anyone share contact details/email of NCLT members so that we raise our concern.
Also is there any tech person in our shareholders, who can host a website so that we all post our comments and make the government, Sebi and all Resolution Plan members understand that we too have every equal right in the company and our stake should not be delisted.

Similar initiative was taken by shareholders of Alok industries. All stake holders of Alok industries had appealed to NCLT.
Read this Article:
https://economictimes.indiatimes.com/markets/stocks/news/nclat-allows-reliance-to-delist-alok-industries/articleshow/72147421.cms?from=mdr
thankimeet2011
Replied to sanjay.spot2022 comment 2 months ago
[email protected] Or +91-9722335047 Ping me here!!
Kamal Garg
Replied to sanjay.spot2022 comment 3 months ago
I think your observations are fully correct. In the Alok Industries case, since delisting was originally not proposed in the resolution plan submitted by RIL, therefore it was rejected. However the judgement reads like this :

"The market regulator last week submitted its views, opposing the waiver unless the resolution plan clearly specified delisting of shares and provided for an exit option to the public shareholders at a specified price."

It further means that delisting can be approved only if the resolution plan states it specifically and also offers a specified price at which existing shareholders would be paid.

We must unitedly fight against such malpractices adopted by acquiring companies and put an end to it.
sanjay.spot2022
Replied to Kamal Garg comment 3 months ago
Any suggestions on how can we fight against such malpractices adopted by acquiring companies and put an end to it
sanjuktabaliarsingh64
3 months ago
Without giving notice through mail
to share holders ahead of desolution of sintex industries loan from bank,jeopardise the interest of small investors is not fair and it seems that all the processes are being done in a haste so as to keep the small investors in dark and facilitating number one richest person to grow up further.
ashish28007
Replied to sanjuktabaliarsingh64 comment 3 months ago
They are silent looters
mmitesh.jobanputra
3 months ago
All the retail investors who invested their hard earned money in Sintex industries have to appeal NCLT to stop the procedures and not to approve anything. Somebody should take the responsibility to lodge the complaint against the concern parties (viz. RELIANCE/ACRE and Sintex Industries) in SEBI.. and the copy of the same should be sent to PMO, Finance Ministry, NSE and BSE.
This should be done at earliest.
Kamal Garg
3 months ago
Electrosteel Steel's equity was not 100% written off. It was only delisted.
You expect retail hapless investors to keep track of all these happenings and understand the procedure at NCLT/RP/IBC Act etc., whereas your own team has failed to notice that Electrosteel Steel's equity was not 100% written off and that it was only delisted (two distinctly different and separate processes). It is too much to expect from retail investors especially when there is a selected leakage of confidential information from RP/CoC end which leads to confusion and rumours in the market.
shamimikhan
3 months ago
If SEBI had warned the investor in time, then the hard earned money of the poor investor would not have been wasted in this way, Now it become the responsibility of the Government and SEBI to do something to avoid drowning the hard earned of retail investors.
ammu3108
3 months ago
If sintex company in losses,Reliance is came forward to takeover & recover losses the investors think positive direction.SEBI have all rights to restrict the tranding why tranding is allowed.All should come forward for legal action on SEBI & RELIANCE.I invested 71,000 hard money.If we do something future generation will not suffer like this.
Jai hind
theseventhidiot
Replied to ammu3108 comment 3 months ago
It is a game. Loot the investor and share alaround. And reliance is master in this game. Ask Anil.
babusharma1005
3 months ago
SEBI not doing any thing they are also involved with such big company RELIANCE and target retail investor and sick company. All are involved in this fraud-why they are allowing to trade in NSE/BSE, only to cheat the retail investor. why there is no policy for retail investor to return their hard earned money. sebi is promoting to participate the retail investor and helping such big CHOR COMPANY RELIANCE to cheat fraud/ where is the CNBC / ZEE BUSINESS CHANENEL the all are DALAL
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