Jindal Poly Films jumps after board approves demerger

capital market | Mumbai |

Jindal Poly Films rose 3.61% to Rs 188.10 at 11:13 IST on BSE after the company said its board approved a plan to demerge its wholly-owned unit, Jindal Poly Investments and Finance Company.

The announcement was made after trading hours on Monday, 26 November 2012.

Meanwhile, the BSE Sensex was up 244.07 points, or 1.32%, to 18,781.08.

On BSE, 77,000 shares were traded in the counter as against an average daily volume of 62,464 shares in the past one quarter.

The stock hit a high of Rs 193.40 and a low of Rs 182.25 so far during the day. The stock had hit a 52-week high of Rs 240 on 10 February 2012. The stock had hit a 52-week low of Rs 143.05 on 19 December 2011.

The stock had underperformed the market over the past one month till 26 November 2012, falling 14.56% compared with the Sensex's 0.47% decline. The scrip had, however, outperformed the market in past one quarter, rising 6.86% as against Sensex's 4.24% rise.

The small-cap company has an equity capital of Rs 43.02 crore. Face value per share is Rs 10.

Jindal Poly Films said the proposed scheme of demerger involves transfer, by way of demerger, of the company's investment undertaking, comprising of investments of the company in its power business, liquid investments and other assets to Jindal Poly Investments and Finance Company (JPIFCL).

As per the scheme, shareholders of Jindal Poly Films will receive one JPIFCL share for every 4 shares held in the company. Equity shares of JPIFCL are proposed to be listed on the NSE and the BSE.

Jindal Poly Films said the proposed demerger will help the company focus on its manufacturing business, which is its core business. Further, the demerger will also help to create a focused holding company mainly for investments. Thus the scheme of demerger will help to effectively cater to the independent growth plans for each of the businesses of the company.

Net profit of Jindal Poly Films rose 28.52% to Rs 63.05 crore on 7.6% decline in net sales to Rs 563.42 crore in Q2 September 2012 over Q2 September 2011.

Jindal Poly Films is involved in diverse activities including manufacturing of polyester film, polypropylene film, steel pipes and photographic products.

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