Amtek Auto up on new hope
A few days back, Amtek Auto and all its group shares were badgered down to pulp. Today morning, Amtek Auto is the top gainer on the BSE, up 10% at Rs.47 with an intra day high of Rs.49.
The reason for this bounce back is a newspaper report which says that it has reached a solution with JP Morgan which will prevent a default – Morgan owns NCDs in the company to the tune of Rs.200 crore and another Rs.600 crore by other banks; of this, Rs.200 crore had matured on 20th Sept while the balance Rs.600 crore was adjusted to the company’s cash flow and are not up for payment any time soon. Amtek due to “cash flow mismatch” could not redeem this Rs.200 crore payment and thus stands safe as of now.
This apart, the company has appointed Morgan Stanley to scout around for an equity buyer (minority stake sale) into its overseas assets, valued at around $2 billion. It has appointed EY and Grant Thornton tin India to see some of its non-core assets and all these activities are expected to bring in around Rs.6500 crore. The consolidated debt of the group currently stands at Rs.17,500 crore and it hopes to bring it down to Rs.11,000 to 12,000 crore in the next 18 months.