Sign up for Equitymaster's free daily newsletter, The 5 Minute WrapUp and get access to our latest Multibagger guide (2017 Edition) on picking money-making stocks.

This is an entirely free service. No payments are to be made.

Download Now Subscribe to our free daily e-letter, The 5 Minute WrapUp and get this complimentary report.
We hate spam as much as you do. Check out our Privacy Policy and Terms Of Use.
Bombay Crying? - Views on News from Equitymaster
  • E-MAIL
  • A  A  A
  • Oct 17, 2000

    Bombay Crying?

    So looks like the raider and the raided in Bombay Dyeing may be smoking a peace pipe after all. The raider will get a settlement price higher than the price paid for the shares purchased while the raided will pay with a bit of pain the settlement price. The raider makes more money and the raided gets to keep a family heirloom. Everyone will be happy. Well, almost.

    There are a few tens of thousands of investors out there who saw the share price collapse from Rs 500 six years ago to Rs 50 (that is correct, an erosion of 90% from the peak price) and were hoping that this raid on Bombay Dyeing could rescue them. That something would be done to see some value unlocked from what, indeed, was a great company run into the ground by some incorrect decisions. Those thousands may not benefit from this settlement. Bombay Dyeing has a fantastic brand name and, as has been noted, some property assets. But the raid on Bombay Dyeing and the reported reactions of the established industrialists reminds us all that there is a club and, to break into that club, you may need to have a pedigree. Smartness and the ability to spot an opportunity are not good enough. And nor is the potential benefit to the thousands of investors in Bombay Dyeing and other dying companies with tepid management.

    The complaints about limited defenses for incumbent managements or stealth tactics of raiders may or may not be correct. And maybe SEBI should or should not change the rules for takeovers. These issues, in any case, will now be the focus of investment bankers and mediators who, always in need of deals, seek new sources of revenues for their businesses. Having just milked thousands of investors of their savings in the recent IPO mania for TMT stocks, investment bankers now need a new line of profits: fees from advising on takeovers will pay for their diwali and Christmas vacations.

    Meanwhile, the song and dances will continue. There will be raiders and there will be defenders. They will fight, they will bicker, and they will all hire investment bankers to settle and mediate. But the small shareholders will continue to be ignored and be the residual factor in any decision-making process. Yes, this is the story of Bombay Dyeing and small shareholders crying.



    Equitymaster requests your view! Post a comment on "Bombay Crying?". Click here!


    More Views on News

    Sorry! There are no related views on news for this company/sector.

    Most Popular

    A 'Backdoor' to Multibaggers: It's Like Investing in Asian Paints Ten Years Ago(The 5 Minute Wrapup)

    Aug 10, 2017

    Don't miss these proxy bets on growing companies or in a few years you will be looking back with regret.

    The Most Profitable Investment in the History of the World(Vivek Kaul's Diary)

    Aug 8, 2017

    'Yes, it looks like a bubble. And, yes, it's like buying a lottery ticket. But there's something happening that has never happened before. It's an evolutionary leap in money itself.'

    Should You Invest In Bharat-22 ETF? Know Here...(Outside View)

    Aug 8, 2017

    Bharat-22 is one of the most diverse ETFs offered so far by the Government. Know here if you should invest...

    Signs of Life in the India VIX(Daily Profit Hunter)

    Aug 12, 2017

    The India VIX is up 36% in the last week. Fear has gone up but is still low by historical standards.

    Bitcoin Continues Stellar Rise(Chart Of The Day)

    Aug 10, 2017

    Bitcoin hits an all-time high, is there more upside left?

    Copyright © Equitymaster Agora Research Private Limited. All rights reserved.
    Any act of copying, reproducing or distributing this newsletter whether wholly or in part, for any purpose without the permission of Equitymaster is strictly prohibited and shall be deemed to be copyright infringement.

    LEGAL DISCLAIMER: Equitymaster Agora Research Private Limited (hereinafter referred as 'Equitymaster') is an independent equity research Company. Equitymaster is not an Investment Adviser. Information herein should be regarded as a resource only and should be used at one's own risk. This is not an offer to sell or solicitation to buy any securities and Equitymaster will not be liable for any losses incurred or investment(s) made or decisions taken/or not taken based on the information provided herein. Information contained herein does not constitute investment advice or a personal recommendation or take into account the particular investment objectives, financial situations, or needs of individual subscribers. Before acting on any recommendation, subscribers should consider whether it is suitable for their particular circumstances and, if necessary, seek an independent professional advice. This is not directed for access or use by anyone in a country, especially, USA or Canada, where such use or access is unlawful or which may subject Equitymaster or its affiliates to any registration or licensing requirement. All content and information is provided on an 'As Is' basis by Equitymaster. Information herein is believed to be reliable but Equitymaster does not warrant its completeness or accuracy and expressly disclaims all warranties and conditions of any kind, whether express or implied. Equitymaster may hold shares in the company/ies discussed herein. As a condition to accessing Equitymaster content and website, you agree to our Terms and Conditions of Use, available here. The performance data quoted represents past performance and does not guarantee future results.

    SEBI (Research Analysts) Regulations 2014, Registration No. INH000000537.

    Equitymaster Agora Research Private Limited. 103, Regent Chambers, Above Status Restaurant, Nariman Point, Mumbai - 400 021. India.
    Telephone: +91-22-61434055. Fax: +91-22-22028550. Email: info@equitymaster.com. Website: www.equitymaster.com. CIN:U74999MH2007PTC175407

    Become A Smarter Investor In
    Just 5 Minutes

    Multibagger Stocks Guide 2017
    Get our special report, Multibagger Stocks Guide (2017 Edition) Now!
    We will never sell or rent your email id.
    Please read our Terms


    Aug 21, 2017 (Close)


    • Track your investment in BOMBAY DYEING with Equitymaster's Portfolio Tracker. Set live price alerts, get research alerts and more. Get access now...
    • Add To MyStocks


    Detailed Quarterly Results With Charts