Welspun Corp jumped 5.23% to Rs 36.20 at 14:32 IST on BSE after the company said that the entire pledge created over the shares of the company held by two promoters have been released by the financiers.
The announcement was made during trading hours today, 7 August 2013.
Meanwhile, the S&P BSE Sensex was down 11.41 points or 0.06% at 18,721.63.
On BSE, 2.97 lakh shares were traded in the counter as against average daily volume of 75,914 shares in the past one quarter.
The stock witnessed high volatility after the company reported poor Q1 results after trading hours on Tuesday, 6 August 2013. The stock lost as much as 15.84% at the day's low of Rs 28.95 in early trade, which is also its 52-week low for the counter. The stock surged as much as 15.11% at the day's high of Rs 39.60 in mid-afternoon trade after the company made the announcement about the release of promoters' pledged shares. The stock had hit a 52-week high of Rs 112.90 on 10 December 2012.
The stock had underperformed the market over the past one month till 6 August 2013, sliding 19.06% compared with the Sensex's 3.91% fall. The scrip had also underperformed the market in past one quarter, declining 31.47% as against Sensex's 4.78% fall.
The small-cap company has equity capital of Rs 131.47 crore. Face value per share is Rs 5.
Welspun Corp said that Krishiraj Trading and Welspun Fintrade, the constituents of Welspun Group promoters have informed the company that the entire pledge created over the shares of the company held by them have been released. With this release, the entire shareholding i.e. 9.49 crore shares constituting 39.58% held by the promoters in the company is free from any encumbrance, Welspun Corp said.
Welspun Corp's consolidated adjusted profit after tax declined 55% to Rs 51.50 crore on 5% growth in sales to Rs 2675.70 crore in Q1 June 2013 over Q1 June 2012. The result was announced after market hours on Tuesday, 6 August 2013.
Welspun Corp's consolidated operational earnings before interest, taxation, depreciation and amortization (EBITDA) rose 9% to Rs 360.90 crore in Q1 June 2013 over Q1 June 2012. Reported EBITDA declined 5% to Rs 224.50 crore in Q1 June 2013 over Q1 June 2012. Welspun Corp said that the company has made a foreign exchange provision of Rs 204.50 crore in Q1 June 2013 which has impacted the reported figures.
Welspun Corp is in the process of demerging its non-pipe business viz. DRI, infrastructure and oil & gas exploration and energy into a separate company.
Welspun Corp's consolidated net debt stood at Rs 3661 crore as on 30 June 2013, higher than Rs 3123.50 crore as on 31 March 2013.
Welspun Corp's current order book position of pipes business stands at Rs 4700 crore. The infrastructure business has a cumulative current order book position of Rs 3914.20 crore.
The company said that the outlook for the pipe business continues to be challenging. While there are some key large scale projects in the pipeline, margins have been under pressure, it added. The Americas, Middle East and Europe will be the key regions which will drive demand in the medium term. The plates, DRI (Maxsteel) and infra businesses continue to face challenging business environment, Welspun Corp said in a statement.
Welspun Corp is a one-stop service provider offering complete pipe solution with a capability to manufacture line pipes ranging from half inch to 121 inches, along with specialized coating, double jointing and bending.
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