Has ED Ajay Gupta quit?
Is there something going on in Commercial Engineers & Body Builders Co (CEBBCO) that the public and shareholders do not know about? After Moneylife’s write up on CEBBCO’s sharp fall in stock price (CEBBCO, promoted heavily by several broking firms including Enam, crashes 35% in two days), it was found out that there is more that meets the eye about what is going on in the company. CEBBCO’s share price has tanked nearly 75% from a high of Rs107.55 to Rs29.55.
A Moneylife reader learnt through CEBBCO's corporate office at Jabalpur, that its executive director Ajay Gupta is no longer with the company. He's also part of promoter group and son-in-law of managing director Kailash Gupta. Barely two months back, he had addressed a conference call and was on a TV channel stating there is nothing wrong with the company. You can find the link here:
http://articles.economictimes.indiatimes.com/2013-02-04/news/36742967_1_ajay-gupta-market-religare. Moreover, its IR agency (Dickenson-Seagul) is no longer handling CEBBCO’s public relations. Divitya Bansal, CEBBCO's in-house IR person had not been answering phone either.
We checked whether there had been any announcement on Ajay Shah’s resignation, but there has been no notice to the BSE although the latest shareholding pattern features him as one of the promoters.
What is brewing inside the company that caused its heavily promoted share price to tank?
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By gifting stakes, public selling is avoided. This is allowed under Regulation 2 (1)(l) of the Takeover Code (SEBI).
Why fell(Ans: Fell with fear):
========
Jan 22:AG sells his 12% stake to KG.
Jan End-Feb Start: Heavy selling was done, with the fear that there will be public selling by promoters, as it is listed only for last two years.
SEBI: Rejected such move of AG to KG transfer.
Apr 25: AG gift his 12% stake to KG (Father-in-law), as part of family restructring. No money transaction was done. Notified to BSE as well.
Now that issue is solved as of 25th April without any approval from investors.
Reference:
1. 25th April Board of Meeting report
2. 25th April Notification to BSE by CEBBCO