Thursday, May 6, 2010

MAITHAN ALLOYS: MAY COOL DOWN AFTER BONUS


dear Mahesh

what is ur view on maithan alloys.
I have purchased 650 shares at 154 avg.?
can I hold it or book profit?
I can hold it for 2 to 3 years.
is it a good long term bet?
kindly advice

-pruthvi

1. maithan alloys is T GROUP company.
2. promoter holding 74.62 percent is very good.
3. Maithan Alloys Ltd has recommended the issue of Bonus shares in the ratio of 1:2, i.e. One Bonus Share for every Two Equity Shares held by the shareholders on record date to be determined by the Board of Directors.
4. I think after this bonus issue equity of maithan alloys is diluted and share may enter in downtrend for more understanding about downfall after bonus issue read following link
http://sharegenius.blogspot.com/2009/10/bonus-issue-gives-only-psychological.html
5. The Board of Directors proposes to obtain shareholders approval for issue of Bonus
Shares and reclassification of Authorized Share Capital by resorting to Postal Ballot
Process.
6. reclassification of authorized share capital is also dilute equity and makes bad effect on share price.
7. so after bonus and reclassification this share is cool off and may enter in a downward zone
8. book value of maithan alloys is 126.02 but it is also adjusted after reclassification of share capital.

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