The National Stock Exchange (NSE) delisted Rohit Ferro Tech on April 8, 2022. Zee Business’ Research Analyst Varun Dubey decodes the reason behind it.
Rohit Ferro Tech was a part of the National Company Law Tribunal (NCLT). Yesterday, the Kolkata bench of the NCLT team gave permission to the company’s resolution plans. The company became a part of NCLT in 2020 after declaring bankruptcy because of consecutive losses. After that, Tata Steel Mining Company gave Rohit Ferro a resolution plan.
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Additionally, Tata Steel Mining Company did bidding for the company, which was approved by the committee of creditors (CoC), he added.
The company was trading between Rs 3.5-4 in 2021. But because the company was under massive debts, the resolution offered said that the equities needed to be diluted completely. Up until yesterday, the Kolkata Bench did not declare any decision.
Just when the Kolkata bench of NCLT approved the resolution plan, the National Stock Exchange market pulled out of any trading activity for the company without offering any opportunity for the retail investors to exit from the stocks, Dubey said.
The company owes banks a debt of Rs 3,885 crore. The company grew by 7 per cent from its original value. The closing value of the company was Rs 28, and the high was Rs 58. Lenders will get up to 13 per cent to 14 per cent, but the retail investors are going to face the brunt by losing their money invested in it, the Analyst said.
Market Expert Rohit Bansal said that retail investors should not get lured for gains from the company that enters the NCLT. He recommended it’s best for investors to take exit from the stocks of companies that go into NCLT to avoid loss of funds.
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– Zee Business (@ZeeBusiness) April 8, 2022