Over 1 crore shares of Bhushan Steel promoters invoked in August

Written by Jash Kriplani | Mumbai | Updated: Aug 21 2014, 09:52am hrs
With the market value of Bhushan Steels shares falling more than 65% in August, lenders have invoked 1.3 crore shares belonging to the promoter group of the Orissa-based company during the month. With Bhushan Steel's shares trading at average price of R256 in August, the value of the invoked shares stands at R334 crore. .

As per a BSE disclosure on Wednesday, 82,086 shares belonging to the promoter group company Bhushan Infrastructure were invoked by IFIN Securities on August 7. Among the promoters, Neeraj Singals holding has fallen from 32% in July to 26.93%, as per the disclosures on the BSE. Meanwhile, Brij Bhushan Singals holding in the company has fallen below 20% to 19.84%. The promoter group pledged another 17 lakh shares during August.

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Bhushan Steel has been in the news over the role of its vice-chairman and managing director, Neeraj Singal, in an alleged case of bribery involving Syndicate Bank. On August 7, the CBI arrested Singal after the special court issued a non-bailable warrant.

On August 2, the CBI had arrested Syndicate Banks chairman SK Jain (now suspended), accusing him of taking a R50-lakh bribe for extending the credit limit of Bhushan Steel and Prakash Industries.

For the year to March 2014, the company reported an operating profit of R2,690 crore and net profit of R59 crore on net revenues of R9,276 crore. The companys finance costs jumped 29% to R1,663 crore from R1,287 crore in FY13. The total debt on the companys balance sheet stood at R31,839 crore for the year-ended March, 2014, as per data from Bloomberg. The company's market capitalisation has more than halved to R3,119.06 crore from R10,265 crore in February. YTD, the scrip has lost 71.35%.