Dunlop India Approved for Stock Market Trading

Dunlop India Ltd shares are ready to trade on India’s stock exchanges again more than four years after being de-listed following the non-payment of listing fees. India’s Board for Industrial and Financial Reconstruction (BIFR) has asked stock exchanges throughout the country to lift any remaining suspensions imposed on the tyremaker.

According to a statement released by Dunlop India, the March 16 order given by the BIFR directed the stock exchanges in Mumbai, Kolkata, Ahmedabad, Chennai and Delhi to lift suspension and also directed both India’s National Securities Depository (NSDL) and Central Depository Services (CSDL) to issue identification numbers for demat of the shares.

The statement also gave news that the BIFR order permitted the company to issue 27 million new shares valued at Rs 10 each (£0.012) by April 15, 2007 and increase the authorised capital from the current level of £8.17 million up to £8.76 million. The tyremaker’s current paid up capital is £5.25 million but after the proposed rights offer this will increase to £8.4 million.

Dunlop shares were last traded in India during February 2003, with their last day of trading on the influential Bombay Stock Exchange being April 15, 2002. The company has been attempting to gain re-listing since mid-2005, even while purchase negotiations between the Ruia group and previous owners the Manu Chhabria family were still in progress. In the words of Dunlop India Ltd chairman Pawan Kr Ruia, “We had been trying to debottleneck the issue since we took over Dunlop in 2005. Now, the shareholders will be rewarded for their patience as the production in both factories of Ambattur and Shahagunj is already stabilising.”

In line with the Securities and Exchange Board of India, Dunlop’s Ruia group has made an open offer of the company at Rs 10 per share up to 20 per cent of the company’s equity. The open offer will close on March 23. The Ruia group holds a 74 per cent equity stake in Dunlop India.