FCI Delisting - Boon Or Bane
One more buy back and one more delisting from the cluster of shares I like. I am talking about FCI OEN Connectors. The said company is getting delisted and the exit price is Rs. 700.00. I have recommended the stock at Rs.408.00 and those reading this blog regularly, would have made profit.
But, I have a thing against Delisting. I really don't like when companies go for delisting because it forces us to part away with some of the most beloved treasures. In the past I had to surrender my holdings in Cadbury's, Philips and many more. An investor sows the seed in a good company and when it starts to bear fruits the company goes for delisting. This should be stopped and rules should be changed. Similarly, defaulter companies should be punished heavily instead of delisting shares.
There are three types of delistings. This is either when a substantial acquisition of shares by acquirer (where the public holding dips below requisite levels) takes place and an exit offer made, or through mergers/acquisitions or compulsory delisting enforced by the stock exchange.
Investors also face the bane of being stuck with shares of a company that has not witnessed trading for years. Over the past two years, at least 26 companies, mainly multinational companies have delisted themselves from the stock exchanges, while another 90 other firms propose to do the same in coming years.
Imagine, many people have invested at the nascent stage of company and when promotors (of good and mulinational companies) feel that they should be given a free run they go for delisting or is it something else ? Why are several companies delisting themselves from the bourses? Should they be allowed to do so, while keeping shareholder and investor interest paramount? Readers please post your comments.
But, I have a thing against Delisting. I really don't like when companies go for delisting because it forces us to part away with some of the most beloved treasures. In the past I had to surrender my holdings in Cadbury's, Philips and many more. An investor sows the seed in a good company and when it starts to bear fruits the company goes for delisting. This should be stopped and rules should be changed. Similarly, defaulter companies should be punished heavily instead of delisting shares.
There are three types of delistings. This is either when a substantial acquisition of shares by acquirer (where the public holding dips below requisite levels) takes place and an exit offer made, or through mergers/acquisitions or compulsory delisting enforced by the stock exchange.
Investors also face the bane of being stuck with shares of a company that has not witnessed trading for years. Over the past two years, at least 26 companies, mainly multinational companies have delisted themselves from the stock exchanges, while another 90 other firms propose to do the same in coming years.
Imagine, many people have invested at the nascent stage of company and when promotors (of good and mulinational companies) feel that they should be given a free run they go for delisting or is it something else ? Why are several companies delisting themselves from the bourses? Should they be allowed to do so, while keeping shareholder and investor interest paramount? Readers please post your comments.
posted by Raj @ 6:55 PM
3 comments
3 Comments:
Dear Raj,
I do not think there should be any issues for delisting but it should not be at whims of promoters. These same promoters again approach the capital market again. This should be banned. We have companies like DLF, Triveni even I think Bharati which delisted and had public issue again.
Just browsing the internet, very, very interesting blog.
Dear Raj
I fully agree with you.
even iam against delisting of good valued companies while defaulters go unpunished.
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