- Wealth PMS (50L+)
I noted last quarter – on October 13, 2011 – that :
The promoters of Sintex “plan” to buy 4.78% and take their stake up to 40%, says MD Amit Patel in a post-earnings conference call.
I don’t really get this. Why would you announce a purchase BEFORE you buy? The stock will run away. Typical promoter buys are announced about 10-15 days after the acquisition of shares. There needs to be a SEBI restriction that needs them to announce within a week, but that’s a different story.
It’s been a quarter from then, and two things have happened:
a) The promoters have NOT bought a single share. Not a single announcement has come from Sintex to the exchanges post October 2011 – and they have to announce any promoter buys.
b) The stock price has fallen over 42%, from 115 then to Rs. 66 now.
The point is: Don’t trust announcements, especially where they say they will do X, when they can be doing X already.
I really liked Sintex promoters before this and now have a bad taste in the mouth. I have traded the stock – mostly successfully but recently took a loss when the stock fell from 185 to 140 (my 25% wide stop was hit). But the stuff that’s been happening recently is triggering big time alarm bells – at this time I would trust the technicals, and distrust all fundamentals.
The current rumours in the market are – a) The Ambani brothers will reunite and b) RCOM may be close to a tower deal. I am Sintexofying those rumours also.