Tube Investment got 50.64% stake allotted on 26th November 20, in CG Power (eventually will rise to 59% in the next 18 months on Warrant conversion) is an old news now. Inspite, share of Tube is evincing lot of Fund and HNI buying interest in last 1 week, making share to rise by about 5%. Investors close to Tube are attributing this rise, on an early turnaround of CG Power, with bottomline to be seen in black for FY22 itself, of CG, with EBIT seen at Rs. 460 cr and PBT at Rs. 400 cr, due to low interest cost and big traction to be seen in Industrial System segment of CG.
Tube held many investors' meet in last 1 week, where road map of CG were laid out, with 51% of this will get added in the financial of Tube in FY 22. Strangely, CG share price fell by about 8% in last 1 week, in the same period, when Tube rose by 5%. Insiders are seeing this as a big shake up in share price of CG being played out by the big players, to acquire a large chunk in CG, as 36% is held by Funds and HNIs, like Bharti group, 5 mighty stock brokers, who are not ready to exit, with 13% stake being held by 1.46 lakh retail shareholders of 15.94 cr shares, with each investor holding about 1,100 shares. With frequent UC & LC, retail shareholders get confused and scared and thus seen exiting from the stock, with same having mopped up by the HNIs.
Hence, if share price of Tube is rising on CG theme, there is no reason for share price of CG to remain behind. Hence, catch up in share price of CG will be seen, once appetite of these HNI investors get satiated. Need to see when power of CG re-ignites?