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“In India, companies may fall sick, but promoters rarely do!”

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November 2, 2010

Lloyds Steel @ Rs 14….. Promoters Stake now 57.75% from 17.61% on Conversion of Warrants at Rs 10

On December 24,2009 and then soon after on January 7,2010 I had blogged on Lloyds Steel and asked you to watch out for it in 2010…it was Rs 9 in December 2009 then flared up in January to Rs 13+ going all the way to Rs 20 before reacting back to Rs 12…past few days it’s been lively and gone up past Rs 15 to settle at Rs 14 today…..I had stated that a Turnaround was in the offing and the Promoters were awarding Convertible Warrants to themselves to up their stake from just below 18% to past 54% on conversion 

Check out these earlier Blogs

LLoyds Steel closes strong at Rs 12.91 despite going into Trade-to-Trade from tomorrow

Thursday, January 7th, 2010

Lloyds Steel @ Rs 9/10…Turnaround from Treachery !?

Thursday, December 24th, 2009

Lloyds Steel has just allotted, on October 29,2010, 1,68,500,000 shares on conversion of the Warrants issued to the Promoters two companies,Shree Global Tradefin Ltd and Trump Investments Ltd…Thus these two companies which held 9.09% of the Equity of Rs 224.16 crs will now hold 48.23 % of the new Equity of Rs 392.66 crs,up by 39.14 %

The promoters who held 17.61% of the Equity,which included the 9.09% held by the above two promoter companies, will now hold a controlling stake of 57.75% with this conversion at par value of Rs 10

The conversion has been done within 2010 itself when it could have been done by mid 2011 too….this is a positive sign as promoters have infused the committed fresh funds into the company,albeit at par through this conversion  

Now await the next step…demerging the Engineering Division into a company to unlock it’s potential…..Shareholders will get free shares of this demerged company

Looks Like 2011 will be an interesting and rewarding year for Shareholders of Lloyds Steel as it’s restructuring of debt and infusion of fresh equity to bring down the leverage and it’s return to profitability sparks of it’s revival

Cheers !

The ABC of CORRUPTION….Aggression is the best form of Defence

A for ADARSH

B for BOFORS

C for COMMONWEALTH GAMES

The ruling Congress Party certainly is heavily weighed down and is adopting the strategy that aggression is the best form of defence…..just heard on a TV News channel,the  party bigwigs,President Sonia Gandhi and FM Pranab Mukherjee lambasting RSS/BJP for the Babri Masjid demolition when attacked for no immediate action being taken against Party Cronies and Allies for mindboggling, blatant and shameless Corruption that’s looting our nation

The 2G Spectrum Telecom scam yet burns all of us….The Controversial DMK Ally yet remains  the Telecom Minister….it’s like ‘Munnabhai’ Sanjay Dutt boasting to the Hospital Dean in the Movie ” Yes I cheated in the Medical Exams to come first…try and find out how…do whatever you can and is in your power….I don’t care….you can’t touch me !”…..and the Andhra Pradesh/Maharashtra/Karnataka Mining Scams spreads across all political parties 

So what have we here….Corruption v/s Communalism…..Congress v/s BJP….Both have weighed down INDIA and our 1.2 billion people for far too long…..I daresay both have shamefully amd immorally become idealogies and political mindsets have been corrupted beyond redemption….common man continues to suffer and remain helpless….how many really have the courage to confront and become genuine social activists 

So often I wish,especially when even our Judiciary is helpless and challenged and confronted and violated and even held in contempt,that we have a ‘Shahenshah’ Amitabh Bachhan who takes the matter into his own hands to cleanse the Corrupt,Immoral and ‘Goondagiri’ System….that would be the best and quickest deterrent so we don’t misuse our Democracy

A Paradox Tragedy…to change the System you have to join it….the tragedy is that once you join it with laudable intentions,you may change,not the system !

Just a last agitated thought….are our State CMs answerable only to the Party President,Mrs Sonia Gandhi and not to the People of the State they head and to all Indians in general ! ?

Nevertheless have a Happy Diwali and a Prosperous New Year….these issues can be tackled next week !

Cheers ! 

Sell SABERO ORGANICS GUJARAT @ Rs 65-Rs 70 range on Corporate Governance issues

Over two years ago on Thursday,August 7,2008 I had initiated a SS 1 recommendation of Crop Protection Chemicals Company,SABERO ORGANICS GUJARAT at Rs 26 as a potential multibagger

It rose to levels of Rs 80 + and is now quoted at Rs 65-Rs 70 range…I had it in the Potential Multibaggers Segment in 2008 and early 2009 and as Share Price crossed Rs 50 I moved it to the Growth Segment last year….even in recent blogs I had opined that Sabero holds potential

But have just taken a Call to recommend a ‘Sell’ for SABERO ORGANICS GUJARAT on Corporate Governance and lack of Transperancy Issues that specifically deal with no clarification forthcoming from the Company on the recent adverse Press Report for fradulent exports and also if any court cases were recently filed in the past two years against the company and if any consent terms were filed and any restraining clauses or orders  

Press Reports allege that SABERO ORGANICS has been caught exporting large quantities of herbicide under the registered trade name of it’s competitor,Excel Crop Care which is a Shroff Group Listed Company quoted at Rs 320 today and a pedigree of 60 years and was earlier called Excel Industries Ltd

Check out the report in the October 11,2010 edition of The Afternoon Despatch & Courier,a local late morning Mumbai tabloid 

http://www.afternoondc.in/city-news/spurious-pesticides-affecting-agriculture-farmers/article_10472

Am aware that Corporate warfare and vested interests and planted media leaks may be involved here…..and would have liked to hear the Company clarify on this…..however it has stayed quiet so far on this adverse press report…..  this heightens the risk of remaining invested…..commonsense directs and dictates that when in doubt stay out or get out..eliminate the risk…exit the scrip

Am also aware the Company is to declare  it’s Q2 September 30,2010 results today..but have decided to make this call to Sell regardless of the results

If you are on my wavelength on this and have invested in SABERO ORGANICS my advise to you is to exit,even at a loss if you’ve brought it at Rs 70+ in 2010….most of you will be booking profit if you’ve picked it up in 2008 and 2009 and in early 2010

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