Current stock price of Great Offshore unsustainable: Analysts
As the takeover battle between Bharati Shipyard and ABG Shipyard for Great Offshore heats up, analysts feel it is the right time for retail investors to book profits as the fundamentals of the target firm"s stock do not support sustainability of its current price. - ABG Shipyard gears up to match Bharati"s open offer - Bharati expects nod for Great Offshore open offer soon - Bharati Shipyard mulls Rs 200-cr capex over two years - Sebi may ok Bharati"s offer for Great Offshore in 10 days - No offer received from Bharati Shipyard, ABG: Great Offshore - ABG to counter Bharati"s bid for Great Offshore Ever since the bidding war between Bharati and ABG started in June, Great Offshore"s stock has jumped significantly. While its stock price was Rs 247.95 on April 1, on June 1 it touched Rs 373.70 and closed at Rs 560.55 on October 1. "The current price is not a true reflection of the fundamentals of the stock. The prices are skyrocketing because of the hostile takeover issue. Prices are not justified at this level," Ashina Stock Brokers Research Head Paras Bothra said. Retail investors should book profits at this level and rationalise at the peak as the stock has jumped more than 100 per cent over the last few weeks, he added. Similar sentiments were expressed by SMC Capital"s Equity Head Jaggannadham Thunuguntla. "In a scenario like this when there is a takeover anxiety, fundamentals will be forgotten and share prices are likely to trade at a premium," he said. Retail investors should book at least half of their position because the fundamentals are not being justified at the takeover price, he added. In June this year, Bharati Shipyard had made an open offer for 20 per cent stake in Great Offshore for Rs 344 per share. This was countered by ABG Shipyard with a price of Rs 375 per share. Subsequently in July, Bharati increased the offer price to Rs 405 per share, which was again met with a counter offer from the rival at Rs 450. In August ABG Shipyard, which holds 8.28 per cent stake in Great Offshore, again increased the offer price to Rs 520 per share. On September 16, Bharati Shipyard acquired 3.01 per cent stake in Great Offshore from the open market with the highest share price at Rs 560, as a result of which the open offer price for acquiring Great Offshore has been revised to Rs 560 per share. The stock market regulator is likely to approve the open offer by both ABG and Bharati to acquire Great Offshore soon. Great Offshore, with net sales of Rs 1,139.2 crore and profit of Rs 275.07 crore for the year ended March 31, 2009, provides logistics support, engineering services and port and terminal support apart from offshore drilling.Payday cash commented:
Analysts have said it right that this is the correct time for the retail investors to step in it’s a great chance for them to have the share in the profits.
21.07.2011
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Technical analysis is playing very important role in this industry. Proper technical and fundamental analysis can help investors to make huge profit.
09.11.2011
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14.11.2011
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15.11.2011
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This is common in the World Market. Many businesses nowadays have problems regarding their stocks.
15.11.2011
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This is common in the World Market. Many businesses nowadays have problems regarding their stocks.
15.11.2011
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15.11.2011
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Stocks in every business must be stable for your business to run smoothly.
17.11.2011
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You got it right, yeah that\'s true & i do believe that retail investors should book at least half of their position because the fundamentals are not being justified at the takeover price, he added.
28.11.2011
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This was countered by ABG Shipyard with a price of Rs 375 per share.
29.11.2011
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Ashina Stock Brokers Research Head Paras Bothra said. Retail investors should book profits at this level and rationalise at the peak as the stock has jumped more than 100 per cent over the last few weeks, he added.
03.12.2011
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Analysts have said it right that this is the correct time for the retail investors to step in it’s a great chance for them to have the share in the profits.
03.12.2011
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Many firms having a current price unsustainable but it\'s good for the cost.
19.12.2011
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27.12.2011
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Great analysis for the current stock price of Great Offshore.
02.01.2012
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18.01.2012
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01.02.2012