DHFL Shares Hit Upper Circuit For Second Day Despite Its Shares Losing Their Value

Shares of Dewan Housing Finance Corporation (DHFL) in intra-day trade on Tuesday (June 8, 2021) hit upper circuit limit of Rs. 22.85 per share on the NSE, surging close to 10%. This is after the NCLT or National Company Law Tribunal approved the resolution plan proposed by the Piramal Group.

DHFL Hits Upper Circuit For Second Day Despite Its Shares Losing Their Value

As per the resolution plan, the shares of DHFL will be delisted from the exchanges. ''As part of the Resolution Plan, the equity shares of the Company are proposed to be delisted,'' said the company in an exchange filing.

The NCLT's Mumbai bench gave a go-ahead to the Piramal Group's resolution plan with some conditions. Further the bench rejected the plea of Kapil Wadhawan-Chairman of the Board of Directors of DHFL who sought a copy of the resolution plan.

Pirmal Group's fully owned subsidiary company Piramal Capital and Housing Finance (PCHFL) has made a proposal to acquire DHFL for a financial consideration of Rs. 37,250 crore. Further as part of the resolution plan DHFL will be delisted from the bourses and business shall be merged with PCHFL.

The offer by Piramal Group comprises an upfront payment in cash of Rs. 12700 crore to the creditors. Also, the group has offered to pay Rs. 3000 crore in cash consideration to lenders from interest earnings realized on the existing cash on the books of DHFL, and additional Rs. 1000 crore for insurance stake, and furthermore Rs. 1000 crore cash in lieu of interest income.

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