India Infoline - A Very Important Development

India Infoline - Buy Recommendation

The board of India Infoline today gave the go-ahead for the Rs. 80 crore investment by DSP Merrill Lynch Capital Ltd. through 8,000 optionally convertible bonds of Rs. 1 lakh each. It has also approved Rs. 20 crore to be invested by Bennett, Coleman & Company Ltd (BCCL) through 11,76,471 equity shares at Rs. 170 a share. The conversion price for the bonds would be formula linked, subject to a Sebi floor price of Rs. 141 and a price cap of Rs. 170 per equity share.

"These investments shall help fuel the aggressive growth plans charted out by India Infoline," the company said in a statement. At the EGM of India Infoline held today, the company also approved the promoters' plan to invest Rs. 44.20 crore through 26,00,000 equity warrants convertible into equity share at a price of Rs. 170 per share. The warrants would be convertible into equity shares within 18 months. "Keeping in mind the dominant promoter guidelines of the stock exchanges, promoters have to maintain their stake above a stipulated level. We could have subscribed to the warrants at a price of Rs. 141, but we decided to subscribe at the same price as other external investors, keeping in mind the interest of all stakeholders," R Venkatraman, one of the promoters and executive director of the company, said.

India Infoline, which announced a dividend of Rs. 2 per equity share, also announced a tie-up with stock market expert PN Vijay to launch a Portfolio Management Scheme (PMS) to be managed by Vijay.