Billionaire investor Rakesh Jhunjhunwala has picked up an equity stake in Sterling Holiday Resorts India Ltd by converting the warrants, which he had subscribed in September last year.
Similarly, the promoter cum a private equity firm Bay Capital and other investor Radhakrishna Damani have also converted their warrants into stake. The total value of these conversion is estimated to be around Rs 17.1 crore.
The company got its board of directors approval on Monday to allot 30,39,888 equity shares arising out of conversion of warrants issued on preferential basis.
The warrants converted are from who invested around Rs 80 crore for a little over 14% stake in the company, last year. The converted shares would amount to around 4.87% of the total shares.
In September last year, Jhunjhunwala and investor Damani have invested around Rs 80 crore for a little over 14% stake in Chennai-based Sterling Holiday Resorts India Ltd, founded by timesharing veteran R Subramanian in 1986.
Meanwhile, the company has posted a net loss of Rs 0.90 crore for the quarter ended June 30, 2012, as against a net loss of Rs 4.61 crore for the same period of last fiscal year. The total income stood at Rs 30.27 crore for the quarter, compared to Rs 18.30 crore during the corresponding period of last year, an increase of 65.41%.
The result for this quarter has recorded a growth and the company would continue to post EBITDA profit, said Ramesh Ramanathan, managing director, SHRL. “The business is expected to turnaround this year and would soon reclaim the top position it once had in the timeshare business in India”, he said while addressing company's shareholders at the company's annual general meeting in Chennai on Monday.
The company is currently in the stage of refurbishing its existing resorts and would launch new resorts on long term lease basis, while the plans for new green field projects would be taken up only after the renovation activities completed, he added.
SHRL currently has around 15 pieces of land bank vacant for green field projects. The land bank, which has been with the company for years, are in places including Munnar, Yellagiri, Coorg, Peerumedu, Rameswaram, Mahabaleswar and Goa, among others.
It is to be noted that the company has earlier announced its plans to invest around Rs 120 crore for renovation of existing resorts and setting up of five new resorts in the current year. It has around 1,450 units or rooms, in a total of 19 resorts, as on mid-June 2012.