Piramal Glass was locked at 20% upper circuit at Rs 92.80 at 11:31 IST on BSE after the company's board approved delisting of shares from the stock exchanges.
The announcement was made during market hours today, 10 February 2014.
Meanwhile, the BSE Sensex was up 2.15 points or 0.01% to 20,378.71
On BSE, so far 20,318 shares were traded in the counter with pending buy orders of 5.72 lakh shares at upper circuit. The stock has an average daily volume of 5,202 shares in the past one quarter.
The stock opened with upward gap, gaining by the maximum 20% daily circuit and remained locked at the 20% level at Rs 92.80 so far during the day. The stock hit a 52-week high of Rs 106 on 30 September 2013. The stock hit a 52-week low of Rs 67.50 on 3 February 2014.
The stock had underperformed the market over the past one month till 7 February 2014, falling 9.27% compared with the Sensex's 1.53% fall. The scrip had also underperformed the market in past one quarter, sliding 13.82% as against Sensex's 2.14% fall.
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The small-cap company has an equity capital of Rs 80.91 crore. Face value per share is Rs 10.
Piramal Glass said that the company's board of directors at its meeting held today, 10 February 2014 approved voluntary delisting of equity shares of the company from the stock exchanges. Total promoter holding stood at 74.16% in Piramal Glass (as per the shareholding pattern as on 31 December 2013).
Piramal Glass had after market hours on Friday, 7 February 2014 said that the company has received a proposal dated 7 February 2014 from Sri Hari Trust acting through its corporate trustee PEL Management Services (proposed acquirer), to acquire the fully paid-up equity shares of Piramal Glass held by public shareholders in accordance and compliance with Sebi (Securities and Exchange Board of India).
As per the delisting proposal, the objective of the proposed acquirer in making the delisting offer is to give flexibility to the promoter group to provide the desired financial support to the company including modifying the existing capital structure, infusing additional capital and adequately supporting the company's strategic growth initiatives, the company said in a statement.
The company needs capital infusion to correct its gearing and liquidity issues, which the promoter is willing to provide. However, with the promoter group shareholding being almost 75%, capital infusion options in the company are limited due to the current state of capital markets. Thus, the delisting proposal would give the company flexibility to deleverage itself and recognize its operations to improve its performance. Additionally, given the trading volume of the company's shares, the promoter group believes that the delisting proposal is in the best interests of the public shareholders as it comes with an opportunity to exit, Piramal Glass added.
The promoters have fixed an indicative offer price of Rs 100 per share for public shareholders, which represents a premium of approximately 30% to the closing price on NSE as on Friday, 7 February 2014, being the date of the letter of proposed acquirer, Piramal Glass said in a statement.
Piramal Glass' consolidated net profit jumped 111.6% to Rs 9.12 crore on 11.5% growth in total income to Rs 470.56 crore in Q2 September 2013 over Q2 September 2012.
Piramal Glass is engaged in the manufacturing of flacconage glass for the pharmaceuticals and perfumery businesses. The company's end-to-end flacconage solutions include full bottle design capabilities, in-house mould design, CNC machines for mould manufacturing, high quality glass manufacturing and dedicated ancillaries for decoration and accessories like caps, cartons and brushes.
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