Star Paper promoters offload 10% in 2 sessions

Promoters have pared down their holding by 10 per cent in Gouri Prasad Goenka-controlled Star Paper Mills in just two trading sessions.

The shares were offloaded in the open market in two tranches by ISG Traders, a promoter group company.

On December 9, the promoter group brought down their holding from 64.67 per cent to 61.69 per cent. Again, on December 10, the promoters' holding was pared down to 54.57 per cent.

Gouri Prasad Goenka, chairman of Star Paper Mills, said that the promoters' holding in the company was brought down to about liquidity in the share. "If there is no liquidity then there will be no interest in the company," he said.

Goenka also said that the combined holding of promoters and financial institutions together was at 85 per cent, making the stock illiquid.

As per the shareholding pattern filed with the stock exchanges on September 30, financial institutions had 15.70 per cent included UTI, Industrial Investment Bank of India, Punjab National Bank, IFCI and LIC. Public holding was at Rs 13.68 per cent.

Goenka was also in the process of turning around the company. Star Paper, last year posted a net sales turnover of Rs 158 crore and a net profit of Rs 7 crore.

He said, a number of options were being weighed for the restructuring. Star Paper Mills required both upgradation and capacity expansion.

Goenka, however, could not quantify the investment required to turn around the company. He said, the quantum of investment would depend on the option to be implemented.

He said, Star Paper could also approach the financial institutions for funding the investment. At present, Star Paper officials were working on charting out the revival programme.

The Star Paper scrip today touched a 52-week high of Rs 39.70 on the National Stock Exchange (NSE) and then finally closed at Rs 37.30. On the Bombay Stock Exchange (BSE) the scrip closed at Rs 37.75.