Insider Trading in NBCC?
Check this BSE Trading Data past few days
On Tuesday,July 5,2016 the Volume was just @ 86k & price closed at Rs 195.40…next day was EID Holiday…Thursday the Volumes jumped up over 10x to 953k shares & share price surged to close at Rs 215.30…till yesterday the surge continued with price closing at Rs 257.40
Today,Wednesday,July 13,2016 The Cabinet Committee on Economic Affairs chaired by the PM cleared the disinvestment of 15% Govt stake in NBCC ….the price dropped sharply to close at Rs 229.80,down 10.72% from yesterday’s close and down 13.93% from intra-day high of Rs 267
Deliveries which earlier in the month were one third of Trading volumes dropped below 20% last few days on surging volumes
Someone has taken advantage of prior knowledge last week that there was a CCEA meeting scheduled today and this NBCC Disinvestment was on the agenda
Overnight Volumes don’t jump 10 x & 20 x & are accompanied by surging share price without some inside knowledge…one cannot tag off such huge Volume Surges as mere speculation on ‘Buy/Trade on Information & Sell on News’
The Government’s official Press Release today mentions estimated receipts of this 15% disinvestment at Rs 1706 crs…This indicates a Price of @ Rs 190 per share for the 9 cr shares they plan to disinvest…This Price was available only in the first few days of July this month….so this proposal was formulated then for the CCEA Meeting .There are no immediate pre meeting media reports or govt releases announcing the agenda for today’s meeting…so how did Volumes surge dramatically?….if there were such pre releases then one can concede that aggressive big punters & their circle of followers were taking & making a quick bet like many do on expectations of company results before they are actually made public on or after the announced day of the Board Meeting to approve the same
NBCC’s capital is Rs 120 crs of FV Rs 2 (just split last month from FV Rs 10) of which Govt owns 90% or 54 cr shares.in 2012 it had disinvested 10% (1.2 cr shares of FV Rs 10)through an IPO at Rs 106 to get Rs 127.20 crs…adjusted for current FV 2 comparison this IPO was at Rs 21.2
Quick Inside Game for a Quick Big Buck through abnormal Volumes…..If the Insiders have won then who are the Outsider suckers?…are there really any or are these just created volumes or the Insiders have lost out on this ?…Insider Trading can backfire at times you know…
Something’s not right…but who cares…happens often & destroys the credibility & sanctity of our markets….& have you wondered why only the small fry get penalised,if at all someone does ?
Mark,I’ve not even gone into the Valuation of NBCC….that’s not relevant in this Quick In & Out Insider Game
Am I right or am I right!?….explain the abnormal volumes & surging prices & today’s crash then
From Rs 190 a few days ago up 40% to a 52 week high of Rs 267 earlier today only to crash to close at Rs 229.80 today…Now what?….depends on Disinvestment Price targeted ….now’s that’s another Story 🙂
What do you’ll think?