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    A micro stock spikes 20% on big order from 'Rare Enterprise'; not us, say Jhunjhunwalas

    Synopsis

    The bulk deal data on the BSE showed a 'Rare Enterprise' as the buyer of about 90,000 shares of Him on Wednesday, triggering a 20% spike - the highest tradable limit of the day - in Him shares on Thursday.

    StockETMarkets.com
    Purchases of small-cap and micro-cap stocks by well-known investors are watched closely by the market.
    Mumbai: Rare Enterprises, the entity owned by the late billionaire investor Rakesh Jhunjhunwala's family, has written to the capital markets regulator, clarifying that it was not the firm that bought shares of Him Teknoforge, a micro-cap engineering company with a market value of ₹138.4 crore, on Wednesday.

    The bulk deal data on the BSE showed a 'Rare Enterprise' as the buyer of about 90,000 shares of Him on Wednesday, triggering a 20% spike - the highest tradable limit of the day - in Him shares on Thursday.

    Rare Enterprises wrote an email to top Sebi officials on Thursday that investors have mistaken the Jhunjhunwala-owned entity for the firm with a similar-sounding name. The entity that bought Him shares was Rare Enterprise, not Rare Enterprises. It could not be ascertained who owns or backs Rare Enterprise.

    "This is to bring to your attention that Rare Enterprises has no interest or connection whatsoever with dealings in Him Teknoforge," read the letter addressed to Sebi chief Madhabi Puri Buch and executive director VS Sundaresan. "The entity Rare Enterprise has no connection with Rare Enterprises or any other group firm of the late Rakesh Jhunjhunwala and family."

    About 1.1 million shares of Him Teknoforge changed hands on the BSE on Thursday compared to an average of 326,000 shares traded in the previous two weeks.

    Purchases of small-cap and micro-cap stocks by well-known investors are watched closely by the market.

    Their buying has resulted in stock prices shooting through the roof amid the recent frenzy in smaller shares as such purchases are perceived to be an indication of strong prospects for these companies. Brokers said stock market operators take advantage of such euphoria to push up stock prices.

    Rakesh Jhunjhunwala had named his entity taking the first two letters of his name Rakesh and of his wife Rekha. While it could not be ascertained if Rare Enterprises intends to take any legal action to protect its corporate identity, Regstreet Law Advisors’ Sumit Agrawal, through whom the company shot off the letter to Sebi, said the primary intent behind the communication to the regulator is to “address matters of public interest”.

    On Wednesday, the Emerging India Growth Fund, a venture capital fund managed by Canbank Venture Capital Fund, divested 1.3 million shares of Him Teknoforge. The buyer Rare Enterprise acquired a nearly 1% stake for 96.3 lakh, while Valueworth Advisors, a firm owned by Kanchan Sunil Singhania, acquired 100,000 shares.

    Him Teknoforge shares have rallied 55% in the last month and more than doubled in the past six months. The auto ancillary company reported a profit of 11 crore on sales of 405 crore for FY23.





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    (What's moving Sensex and Nifty Track latest market news, stock tips, Budget 2024 and expert advice, on ETMarkets. Also, ETMarkets.com is now on Telegram. For fastest news alerts on financial markets, investment strategies and stocks alerts, subscribe to our Telegram feeds .)

    Subscribe to The Economic Times Prime and read the Economic Times ePaper Online.and Sensex Today.

    Top Trending Stocks: SBI Share Price, Axis Bank Share Price, HDFC Bank Share Price, Infosys Share Price, Wipro Share Price, NTPC Share Price

    ...more
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