Gujarat NRE receives requests to convert FCCBs into equity shares

Gujarat NRE Coke Ltd has announced that Investors who had subscribed to the FCCB of the Company have started writing to the Company to exercise their option to convert their holding into equity shares. This comes close in the heels to the extremely good times through which the Company is now passing. The global Coking coal and coke market are now witnessing boom times and prices of LAMC and Coking Coal are both on a continuous upswing. This coupled with the appreciation of the Rupee against the US Dollar is adding considerable amounts to the bottom line of the Company. In simple terms it means that while on the one hand the prices of the Company's product is on the upswing on the other the cost of inputs are going down as a strong Rupee buys more and more. Little wonder then, that the investors are clamoring for equity.

The Company had issued 1% Unsecured Foreign Currency Convertible Bonds (FCCB) amounting to US$ 55 million in March 2005. On the very first day of this month, letters requesting conversion worth US$ 0.55 were received by the Company. Such conversion while reducing the liability of the Company, also increases the net worth and the market capitalization.

The stock closed the day at Rs.58.15, down by Rs.2 or 3.33%. The total traded quantity was 658202 compared to 2 week average of 880469. The stock hit an intraday high of Rs.60.50 and low of Rs.57.85.

Source : Equity Bulls

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