How a disclosure error with Adani name catapulted this penny stock
Adani Group has been ruling business news pages almost everyday and with half a dozen large-cap stocks across sectors they have also been in the frontline when it comes to the stock market. The action in the group with acquisitions, diversifications and more has also pushed its promoter Gautam Adani as the third-richest person in the world.
So, when SBICAP Trustee Company, a wholly owned subsidiary of SBI Capital Markets and a debenture trustee, made an inadvertent error with a stock market disclosure with one of the Adani Group company’s name, it set the punters' tongues wagging.
Renewable energy firm Suzlon has been on the penny stock charts for over a decade as it struggled under a massive pile of debt. The company was once a darling in the renewable energy space with its turbines for wind power, and still commands a market valuation of more than $1 billion.
The company never managed to recover after the 2008 stock market crash.
Tantis-promoted Suzlon has been trying to restructure the mountain of debt for a while but the process has been slow.
Suzlon shot up nearly 20% on Monday to hit the upper circuit of Rs 10.57 apiece over a disclosure made last Friday after market hours.
In the disclosure, SBICAP Trustee acting as trustees for the benefit of an REC-led consortium (comprising REC and Indian Renewable Energy Development Agency), which have financed the company and some subsidiaries said that additional 5% stake of the company was pledged for loans taken by ‘Adani Green Energy’.
On Monday, SBICAP Trustee clarified the error that it had mentioned the name of ‘Adani Green Energy’ as the target company instead of Suzlon Energy.
It added that encumbrance has been created by the promoters of Suzlon in favour of SBICAP Trustee only for securing the obligations towards REC led consortium and not in anybody else favour nor for any other purpose. It further clarified that there is no existing or new pledge by the promoters in favour of Adani Green Energy.
However, punters are guessing that Adani Green Energy could be lurking somewhere in the shadows and that has set the stock on fire.
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