Rakesh Jhunjhunwala seems to have turned bullish on ailing Kesoram Industries, a diversified company chaired by B.K Birla, having large capacities in Tyres, Cements, Spun Pipes etc.
Rakesh Jhunjhunwala through his wife's account has acquired 60 lakh shares in Kesoram Industries taking his shareholding in the company to around 7%. The shares were acquired through rights issue. The company had recently offered its shareholders to buy additional shares in the ratio of 7:5 at Rs 65 apiece.
The other major investor in the company is LIC holds over 10% of the equity shares. As of March-end, promoters had 27.12% stake in the company.
Kesoram Industries has been badly affected by the slowdown in Tyre and Cement business and mounting debt. But the company has huge capacities in both the verticals and is trading at significant discount to it's replacement cost. The stock has lost more than three quarters of it's market value in last 3 years and the market value of the company has come down to just 738 crores based on 10th July closing price.