Friday, 25 October 2013 03:50
-
- {{hitsCtrl.values.hits}}
Ends trading period with a gain of Rs. 16 or 31% to Rs. 67.10; hits a peak of Rs. 72
Nearly 20% of the Rights change handsa
Warrants attached Rights of John Keells Holdings (JKH) have managed to perform well before the last day of their trading, which was yesterday.
Between the trading period from 15 and 24 October, slightly over 26 million Rights or 20% of the total changed hands. Of this quantity was a transfer of 7.9 million Rights from Paints and General Industries and its owner Sohli Captain last week. Excluding that deal only around 14% of the Rights traded.
Price of the Rights however did experience volatility. From a pure price of Rs. 40, it hit a high of Rs. 72 yesterday. On Monday the Rights price dipped by Rs. 16.30 to Rs. 45 level from Friday’s closing of Rs. 62 which some linked to excessive foreign selling overall on JKH. However the Rights ended yesterday up by Rs. 16 to close at Rs. 67.10.
A few foreign funds had sold their Rights, judging by the fact that total non-national holding amounted to 62.3 million yesterday as opposed to 66 million on 15 October.
JKH recently announced a Rs. 40 billion staggered fund raising exercise via shareholders issuing a Rights-Cum-Warrants issue.
Analysts said attaching warrants added value to Rights as investors speculated on the former. This was the reason why Rights commenced trading above its pure price last week as well as managing to close higher.
Independent analysts had valued the Warrants to be worth around Rs. 60 to Rs. 70 each.
JKH proposed a Rights Issue of two new ordinary shares for every 13 held at Rs. 175. Two warrants are attached to the subscription of Rights on the basis of one warrant for every three Rights subscribed at Rs. 185 per warrant in two years and on similar basis at Rs. 195 per warrant in the third year.
This is to part finance the country’s biggest private sector project by JKH – The Waterfront, an integrated resort inclusive of gaming with an investment $ 650 million.
