KGN Scrip Shoots From Rs 100 To Rs 55K After 7Yrs

The shares of Ahmedabad-based KGN Industries Ltd had an unbelievable KGN Industriesrun on the Bombay Stock Exchange upon re-listing on Wednesday (May 21).

The stock of KGN Industries soared to Rs 55,000 per share from Rs 100 during early trade. This breaks up the record of MMTC which is the most expensive scrip on the bourses at Rs 27,050.

The Z-category stock re-listed after a big gap of seven years. Before its re-listing on May 21, 2008, it had last traded at Rs 11 in 2001 when it was suspended after it failed to fulfill compliance issues with the exchange.

A BSE release noticed that there are no price bands on scrips on the opening day of trading to allow price discovery.

A BSE news release said, “During the early hours of trading, it was discovered that orders were being placed at an unrealistic price. In order not to distort the price discovery process, as few orders were being placed at unrealistic prices, the trading of the scrip was suspended at 12.20 hours as a proactive surveillance measure.”

At the time of suspension of trading, KGN Industries’ spot price was Rs 15,001. But, the BSE stated that it has set a closing price of Rs 5,216.30 a share using the subsisting method but considering the entire trading period.

Trading process will start again on May 22 with the applicable price band, BSE said.

Individual shareowners hold a stake of around 1.43% (or 3.18 lakh shares) in KGN, whereas 49% is held by the promoter group.
Another 49.5% is with domestic corporate bodies.

A KGN spokesperson said, “The company was also shocked by the price spurt. We, too, called the exchange and asked them to look into the matter.”

KGN Industries is engaged in the business of trading in agro commodities like castor seeds, edible oils like soyabean oil, palm oil, non edible oils like petroleum products, lubricants, used oil.

The company reported a turnover of Rs 326.87 crore during the year 2006-07

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