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ADAG stocks trade weak; RCom hits new low after lenders sell pledge shares

SI Reporter/Mumbai 14 Mar 19 | 12:02 PM

Analysts say the other key reason for the slow decline was its growing debt burden

Shares of Anil Dhirubhai Ambani Group (ADAG) companies were under pressure with Reliance Communications (RCom) hitting a new low of Rs 4.65, down 5 per cent on the BSE, after lenders sold 120 million pledged shares that accounted for 4.34 per cent stake of promoters in the telecom firm.

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Besides RCom, Reliance Capital (down 7 per cent at Rs 175), Reliance Power (4 per cent at Rs 11), Reliance Infrastructure (3 per cent at Rs 126), Reliance Naval and Engineering (3 per cent at Rs 10), Reliance Home Finance (3 per cent at Rs 27) and Reliance Nippon Life Asset Management (2 per cent at Rs 198) were down in the range of 2 to 7 per cent on the BSE. In comparison, the S&P BSE Sensex was up 0.04 per cent at 37,767 points at 11:49 am.

According to regulatory filing, Axis Trustee Services (subsidiary of Axis Bank) acting as security/debenture trustee had sold 120 million equity shares representing 4.34 per cent total equity of RCom on March 11, 2019.

With this sale of shares, promoters' stake in the company has come down to 37.57 per cent from 41.91 per cent earlier. The pledged shares belonged to promoters including that of Ambani, his family members and RCom group entities, according to a BSE filing.

Earlier on March 6, RCom’s promoter s holding in the company declined by nearly 7 percentage points (ppt) on invocation of pledge shares by lenders STCI Finance and IndusInd Bank. Total promoters holding in RCom had declined to 41.91 per cent from 48.77 per cent on invocation of pledge shares on February 25 and March 6, 2019, the company said in a regulatory filing.

As of December 31, 2018, Promoter & Promoter Group held 53.08 per cent stake in RCom, the shareholding pattern data shows.

Meanwhile, the National Company Law Appellate Tribunal (NCLAT) on Wednesday reserved its verdict on a plea moved by RCom to release tax refunds worth nearly Rs 260 crore, held in a trust and retention account with the lenders of the company. Nearly 40 lenders of the company, including the State Bank of India (SBI) have opposed RCom’s plan to use this money to pay off Ericsson contending that the funds for paying the latter must come from a different source. The banks are trustees of the account.

RCom has been reeling under a debt of around Rs 47,000 crore and has opted for invoking bankruptcy proceedings. The matter is sub-judice.

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