Retail investors of Swan Defence and Heavy Industries are facing big losses due to the price discovery mechanism of Indian stock exchanges. Mr. Nikhil Merchant’s company took over Reliance Naval and Engineering, giving investors just 1 share of Swan Defence for every 275 shares of Reliance Naval they previously owned.
This means that the break-even for retail investors for a ₹10 face value share of Swan Defence comes at around ₹2,750, while the share got listed at just around ₹35 on the Stock Exchange.
Even if the stock price increases by the maximum allowed 5% every day, it would still take nearly three years for investors to reach a fair exit price.
Our Founder and MD, Mr. Shriram Subramanian, has been quoted in an article on BusinessWorld, sharing his insights on this matter.
Read the article here: https://www.businessworld.in/article/a-raw-deal-for-retail-shareholders-of-swan-defence-548309
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