Saturday, January 13, 2018

Update on Demerger of Orient Paper and Industries

Dear Readers,

Yesterday was the record date for demerger of  Orient Paper and Orient Electric. The stock was suggested on 29 July, 2017 at 96. Stock corrected to 85 on 10 August, 2017 and touched life time high 181 on 10 January, 2018. the reason behind mentioning these dates and price details because several readers are having intention to buy the Orient Paper at cmp 50 - 55.  We have received lot of comments from last 2 -3 days related to demerger, listing date, buying price, selling price, future prospectus of paper business etc.

Answers for Common Questions

Need to keep the both stocks ( Orient Paper + Orient Electric) for further gain in long term. Both companies are having very good growth potential. Those investors who are holding the stock ( Orient Paper and Industries ) till 12.01.2018 in their demat accounts are eligible to get Orient Electric shares.

It is not advisable to buy  Orient Paper at cmp. It is not advisable to buy any stock + / - 10 % from suggested price. If price is above that range then need to wait for correction or go for next stock. If price is below that range than I will give update on it, if required ( as given for Surana Solar in July 2017). 

Generally demerger process is taking 12 -18 months time from date of proposal to the final listing. We have picked the stocks at mid of the process and Orient Electric is expected to list within next 4 months. We are keeping one stock with ongoing  demerger process so that it will help to improve habit of holding the stock with patience for longer period.

If allocation is near 20% or above then partial profit can be booked near 100% to make the remaining holding free of cost and reinvestment to expand the portfolio without adding fresh fund. Profit can be booked at any time from 100% - 500% or above based on your holding capacity and financial needs.

Our investment in all stocks are for long term and irrespective of weak or good quarterly results. If there is any serious change in fundamental or future business prospectus of the company then only we will review and alter our investment decision. 

Next stock will be posted in the last week of this month, most probably on 27 January.