Sir, can you explain what is reverse merger ? I am asking this in reference to ujjivan small bank, it's mentioned in their annual report that according to RBI guidelines they have to dilute their stake from 83%(now) to 40 % till 2022 and they are telling best option is reverse merger. Plz help sir.
@Aman, Reverse merger is the process when an unlisted company is merged into a Listed company. In this example, Ujjivan Financial Services (UFS) is listed and Ujjivan Small Finance Bank(USFB) is owned by this listed company. In current situation as per RBI guidelines UFS is required to list the bank within certain years of operations. Also, it is required to reduce the ownership in the bank below 40%. To meet both conditions, one otion is to have an IPO. Another option is to have a reverse merger in which UFS shareholders will be the direct owners of the bank instead of indirect. In such a case the promoter holding in USFB will still have to be reduced by diluting the promoter shareholding through a FPO or a QIP. Regards!
@@AmanKumar-zk6lu I see that USFB is a listed entity which came up with an IPO in Dec-2019. Therefore, demerger is technically not possible in USFB after IPO. Interestingly, I searched on the news of demerger of USFB and I found that all the news related to demerger were before the IPO. There is no talk of demerger as of now. Regards!
Good question: Iska lower circuit badal gaya hai. Why? kyunki iski share capital aur book change ho gayi after rights date. In simple words, company ki value 200 crore hai aur uske market me 1 crore shares hain to sab share ki book value rs 200 hogi. Agar company share holders ko bole mujhe 50 Cr do aur main 1 crore shares aur doonga, to company ki book value 200+50 = 250 crore ho jaayegi. But kyunki abhi market mein 2 crore shares ho gaye hain to. har share ki book value Rs 125 ho jaayegi. So, stock exchange knows that and isliye they adjusted the lower and upper circuits. NSE uploaded the document for the calculation of adjustment factor: www1.nseindia.com/content/circulars/FAOP45061.pdf Also, check the last part of my yesterday's video for more info: th-cam.com/video/-p4mO1F57jE/w-d-xo.html Regards!
Hi sir, RE shares anyone can buy? I mean whoever don't have m&m financial in there portfolio? if not, then what is the price to enter into m&m can you share your opinion?
Hi Dinesh, You will get RE shares in your demat if you were the shareholder on 21st July. You can sell or exercise these rights. For those who didn't have shares on 21st you will not get directly. But you can still trade with others who have them. But it doesn't make much sense to buy rights unless they are at a discount. Regards!
Appasaheb, Yes brother! You are absolutely eligible for the rights issue. Tume 28 july tak wait karna hoga. Tume mail aa jaayega company ki taraf se. Tum apni right sell bhi kar sakte ho through your Demat account. Woh karoge to tumhe share nahi khareedne padenge. But don't sell your rights at price less than (Market price - 50). I hope I made it clear. Do message me if you have more doubts! Regards!
Ya aman. You are correct but not completely. Agar tumhare paas 100 shares hain at 200 to tumhari current portfolio value drop ho chuki hogi. At 155 price 45 rs gira hai to 4500 ka loss chal rha hai. But kyunke kal tumhare account me shares the to tumhe rights automatically mil gayi hain. To loss nahi hoga agar tum us right ko bech do ya un rights se shares khareed lo at 50 rupees. You will have time for that. So, abhi kisi ko subscribe karne ki baari hi nahi aayi to loss kaise hoga. Haan, agar tum bhool jaate ho to definitely loss hoga. So, remember these dates: The rights issue will open on July 28 and close on August 11, 2020. The full amount of the issue price of Rs 50 per share will be payable on application. Regards!
@@gurpreetss thank you sir for the clarification. In one of your previous videos you have told that next price will be something between 115-145. And it was. Sir, how were you so sure about the range ?
Thank you for going through the details in the other video. As I said in the other comment, it is the concept of book value and share capital. Share capital doubled but book value didn't increase so much. Since today's buyers don't have access to rights, so they won't be willing to buy at yesterday's prices. Regards!
Sir, can you explain what is reverse merger ? I am asking this in reference to ujjivan small bank, it's mentioned in their annual report that according to RBI guidelines they have to dilute their stake from 83%(now) to 40 % till 2022 and they are telling best option is reverse merger.
Plz help sir.
@Aman,
Reverse merger is the process when an unlisted company is merged into a Listed company. In this example, Ujjivan Financial Services (UFS) is listed and Ujjivan Small Finance Bank(USFB) is owned by this listed company. In current situation as per RBI guidelines UFS is required to list the bank within certain years of operations. Also, it is required to reduce the ownership in the bank below 40%. To meet both conditions, one otion is to have an IPO. Another option is to have a reverse merger in which UFS shareholders will be the direct owners of the bank instead of indirect. In such a case the promoter holding in USFB will still have to be reduced by diluting the promoter shareholding through a FPO or a QIP.
Regards!
@@gurpreetss Sir, isn't USFB already public or listed, as I can see it's share price ?
@@AmanKumar-zk6lu I see that USFB is a listed entity which came up with an IPO in Dec-2019. Therefore, demerger is technically not possible in USFB after IPO. Interestingly, I searched on the news of demerger of USFB and I found that all the news related to demerger were before the IPO. There is no talk of demerger as of now.
Regards!
@@gurpreetssab samajh me aaya....aise inko nhi likhna chaiye tha es bar ke report me... Anyways, as always thanks for your time and help sir.
Another question....lower circuit kyu nahi laga isme...? Plz help Sir, I am new in markets.
Good question:
Iska lower circuit badal gaya hai. Why? kyunki iski share capital aur book change ho gayi after rights date.
In simple words, company ki value 200 crore hai aur uske market me 1 crore shares hain to sab share ki book value rs 200 hogi. Agar company share holders ko bole mujhe 50 Cr do aur main 1 crore shares aur doonga, to company ki book value 200+50 = 250 crore ho jaayegi. But kyunki abhi market mein 2 crore shares ho gaye hain to. har share ki book value Rs 125 ho jaayegi.
So, stock exchange knows that and isliye they adjusted the lower and upper circuits. NSE uploaded the document for the calculation of adjustment factor:
www1.nseindia.com/content/circulars/FAOP45061.pdf
Also, check the last part of my yesterday's video for more info:
th-cam.com/video/-p4mO1F57jE/w-d-xo.html
Regards!
Hi sir, RE shares anyone can buy? I mean whoever don't have m&m financial in there portfolio? if not, then what is the price to enter into m&m can you share your opinion?
Hi Dinesh,
You will get RE shares in your demat if you were the shareholder on 21st July. You can sell or exercise these rights.
For those who didn't have shares on 21st you will not get directly. But you can still trade with others who have them. But it doesn't make much sense to buy rights unless they are at a discount.
Regards!
Sir मैने 100 shares book किये थे और मैने 22 जुलै 2020 sell किया और 9800 loss book किया मै issue apply कर सकत हू क्या
Appasaheb,
Yes brother! You are absolutely eligible for the rights issue. Tume 28 july tak wait karna hoga. Tume mail aa jaayega company ki taraf se. Tum apni right sell bhi kar sakte ho through your Demat account. Woh karoge to tumhe share nahi khareedne padenge. But don't sell your rights at price less than (Market price - 50).
I hope I made it clear. Do message me if you have more doubts!
Regards!
Agar kisi ke pas Rs 200 pe 100 share they ...aur usne rights issue mei subscribe nahi kiya..to uski loss hui hogi kya..?
Ya aman.
You are correct but not completely.
Agar tumhare paas 100 shares hain at 200 to tumhari current portfolio value drop ho chuki hogi. At 155 price 45 rs gira hai to 4500 ka loss chal rha hai. But kyunke kal tumhare account me shares the to tumhe rights automatically mil gayi hain. To loss nahi hoga agar tum us right ko bech do ya un rights se shares khareed lo at 50 rupees. You will have time for that.
So, abhi kisi ko subscribe karne ki baari hi nahi aayi to loss kaise hoga. Haan, agar tum bhool jaate ho to definitely loss hoga. So, remember these dates:
The rights issue will open on July 28 and close on August 11, 2020. The full amount of the issue price of Rs 50 per share will be payable on application.
Regards!
@@gurpreetss thank you sir for the clarification. In one of your previous videos you have told that next price will be something between 115-145. And it was. Sir, how were you so sure about the range ?
@@gurpreetss I got it sir ! You were of great help. I seek more knowledge from you 😃.
Thank you for going through the details in the other video. As I said in the other comment, it is the concept of book value and share capital. Share capital doubled but book value didn't increase so much. Since today's buyers don't have access to rights, so they won't be willing to buy at yesterday's prices.
Regards!