The share price of Haryana-based Pashupati Fincap Ltd today rose from 15 paise to a high of Rs 50 on the Bombay Stock Exchange (BSE) in intra-day trade.
The stock was admitted for trading after eight years. It was de-listed in 2002 over non-compliance issues. The stock was last quoted at 15 paise on the BSE in 2002; it opened at Rs 10 today and rose to dizzy levels. Only 10,686 shares of the company were traded. The share closed the day at Rs 23.10.
All efforts to reach the company were futile. The contact phone numbers of the company on BSE’s website were incorrect. However, BSE data showed that Pashupati Fincap was a non-banking finance company with a thin equity base of 4.7 million shares. Promoter holding in the company was 53.35 per cent, with 36.42 per cent of the equity cornered by other companies, which included Charishma Engineering Ltd, and one Sarla Bagri.
Pashupati Fincap reported a net loss of Rs 17 lakh in quarter ended December 2009 as against a net loss of Rs 1 lakh during quarter ended December 2008. Sales, however, rose 2,240 per cent to Rs 7.02 crore in the quarter ended December 2009, as against Rs 0.30 crore during the previous corresponding quarter.
Yet another penny stock, Midpoint Software & Electro Systems Ltd, rose from Rs 1.40 to touch an intra-day high of Rs 50. It was also traded for the first time in eight years today.
This was not the first time a penny stock had such a brazen price rise. Earlier, BSE was under fire after penny stocks KGN Industries and Sylph Technologies rose nearly 100,000 per cent on the first day of listing after several years. In fact, KGN Industries shot up to Rs 55,000 from Rs 100 in May 2008.
Almost 1,500 stocks have been suspended in recent years over various grounds. Getting suspended companies re-listed and rigging the price to dizzy heights has become a favourite strategy of some operators as there are no circuit filters on the first day of trading. In 2009, as stock markets recovered, several company promoters rushed to get their suspended companies re-listed. These companies had then witnessed a price rise of 300-3,000 per cent on the first day of listing. With promoters and operators exiting the stock since, the prices have come down drastically.
