Kalindee Rail Nirman (Engineers) hit a lower circuit limit of 10% at Rs 122.20 at 12:40 IST on BSE after the company said its board approved the merger with Texmaco Rail & Engineering.
The announcement was made after market hours on Wednesday, 21 May 2014. Shares of Texmaco Rail & Engineering were up 7.41% at Rs 105.80.
Meanwhile, the BSE Sensex was up 199.51 points, or 0.82%, to 24,497.53.
On BSE, so far 43,000 shares were traded in the Kalindee Rail Nirman (Engineers) counter, compared with an average volume of 1.14 lakh shares in the past one quarter.
The stock opened with an downward gap, slumping by the maximum 10% daily circuit and remained locked at that level at Rs 122.20 so far in the day. The stock hit a 52-week high of Rs 135.75 on Wednesday, 21 May 2014. The stock hit a 52-week low of Rs 50.05 on 23 May 2013.
The stock had outperformed the market over the past one month till 21 May 2014, rising 77.57% compared with 6.73% rise in the Sensex. The scrip had also outperformed the market in past one quarter, rising 155.89% as against Sensex's 17.38% rise.
The small-cap company has an equity capital of Rs 16.51 crore. Face value per share is Rs 10.
Kalindee Rail Nirman (Engineers) said that its board at a meeting held on 21 May 2014, approved a scheme of amalgamation, whereby the company shall be amalgamated into and with Texmaco Rail & Engineering.
The board has fixed the share swap ratio 1:1.06, i.e., 106 fully paid-up equity shares of Rs 1 each of Texmaco shall be issued for every 100 fully paid-up equity share of Rs 10 each held by a shareholder in the company, it added.
No shares shall be issued to Texmaco as a result of the scheme, Texmaco's shareholding in the company shall stand cancelled. Texmaco currently holds 49.07% of the issued, subscribed and paid-up share capital of Kalindee Rail Nirman (Engineers), the company said.
Kalindee Rail Nirman (Engineers) added that the aforesaid decision of the board is based on the recommendation received from the audit committee and the Committee of Directors, which was formed by the Board on 2 May 2014 to explore various options for restructuring the company, its businesses and its operational and business relationship with Texmaco, so as to create better synergy within the company and between these entities, and to ensure that the businesses are operated in the most efficient and cost effective manner, with the ultimate aim and intent of enhancing shareholders value and improving the overall working culture/environment.
The scheme shall then be subject to necessary approval of the shareholders, creditors, and the approval and sanction of the Delhi High Court and the Calcutta High Court and other competent authorities, if any, the company said.
Kalindee Rail Nirman (Engineers) reported net profit of Rs 12.65 crore in Q4 March 2014 as against net loss of Rs 1.29 crore in Q4 March 2013. Net sales rose 59.33% to Rs 100.09 crore in Q4 March 2014 over Q4 March 2013.
Kalindee Rail Nirman (Engineers) is a construction company dedicated to building infrastructure for rail transport under one roof on turn key basis. It has been active in fields of signaling, telecommunications, track and information systems.
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