Unitech spurted 6.85% at Rs. 46 at 14:50 IST on BSE on reports the company's promoters have repaid Rs. 50.6 crore to creditors from whom they had raised about Rs. 250 crore a year ago by pledging their shares.
Meanwhile, the BSE Sensex was up 166.12 points, or 0.92%, to 18,188.34.
On BSE, 1.06 crore shares were traded in the counter as against an average daily volume of 33.56 lakh shares in the past one quarter.
The stock hit a high of Rs. 47.15 and a low of Rs. 43.65 so far during the day. The stock had hit 52-week low of Rs. 42.35 on Tuesday, 1 February 2011. The stock had hit a 52-week high of Rs. 98.45 on 7 October 2010.
The stock had underperformed the market over the past one month till 1 February 2011, falling 34.97% compared with the Sensex's 12.13% decline. The scrip had also underperformed the market in past one quarter, sliding 51.74% as against 11.46% decline in the Sensex.
The large-cap real estate developer has an equity capital of Rs. 523.26 crore. Face value per share is Rs. 2.
Shares of Unitech plunged 25.64% in the preceding five sessions to Rs. 43.05 on 1 February 2011 from a recent high of Rs. 57.90 on 24 January 2011.
The creditors from whom the funds were raised had issued a notice to Unitech promoters on Friday, 28 January 2011, saying they would sell the pledged shares in the market on Monday, 31 January 2011, in case of non-payment.
This forced the Unitech promoters to move the Delhi High Court on Sunday, 30 January 2011, and got stay on selling shares in the stock market by the investors.
Reacting to reports on the potential sale of the pledged shares, Unitech's scrip had plummeted by 10.59% to Rs. 43.05 on Tuesday, 1 February 2011.
The Unitech promoters had raised Rs. 250 crore from high net-worth individuals (HNIs) last year through issue of non-convertible debentures and had pledged their shares in Unitech to raise the fund, reports suggested.
The total outstanding by the end of last week was Rs. 178 crore, which the promoters firm was required to pay by May this year, reports suggested, adding that the promoters have started repaying the amount.
In loan-against-share transactions, the lender keeps a security cover of two to three times depending on borrowers' credit rating and track record. Similarly there are other conditions such as downgrading and additional borrowings which call for extra margin. In most cases when loan agreements are breached, the lenders are entitled to sell shares to cover up margins.
Unitech's consolidated net profit declined 2.30% to Rs. 173.76 crore on 26.50% increase in net sales to Rs. 644.51 crore in Q2 September 2010 over Q2 September 2009.
