August 06, 2009

Jalandhar Based Share Holders of Binani Metals Limited Want Face Value Reduced to Re. 1

Jalandhar based shareholders of Binani Metal Limited ( an asset laden investment company of Braj Binani - Binani Cement Group ) want the face value of one share of Binani Metal Limited be reduced to Re. 1. This would improve liquidity. Further , at present , the share is listed only at Calcutta Stock Exchange. The shareholders of Binani Metal Limited want the shares to be listed on National Stock Exchange ( NSE ) and Bombay Sock Exchange ( BSE ),

The shareholders of Binani Metals Limited expressed great regret at Binani Metals Limited 's contention that the face value of the share has been increased from Rs. 100 to Rs.1000 " TO IMPROVE LIQUIDITY . ". At present no other listed share has a face value of Rs.1000 . In this ingenious exercise many shareholders got a very small percentage of the true intrinsic vale ( NAV ) of the share in the compulsory sale of resultant fractional shares. Further, compulsory sale of a shareholder's shares is violative of the shareholder's fundamental right .

It is very unethical that public money is invited when the company has just started functioning. Once over a period of time , that Company becomes financially strong small shareholders are compulsorily bought out and that too , at ridiculously low rates.

Shareholders of Binani Metal Limited felt that had this share been listed on National Stock Exchange ( NSE ) and Bombay Stock Exchange ( BSE ) such an anti small shareholder move could never have been put through by Binani Metal Limited.

No comments: