The share price of Jindal Steel & Power (JSPL) was the top gainer on Nifty Metal index, rising almost 20% intraday on a report that the company promoters are repaying Rs 350 crore worth of loans for release of 10 crore shares.
Post the news report, JSPL shares opened with a gain of 4.43% today and later climbed 19.46% intraday to Rs 75.5 on BSE
With an intraday volatility of 5.24%, JSPL stock has traded in a wide range of Rs 9.5. On NSE, Nifty metal was gaining 6% today.
According to a Mint report, most of the lender's loans are from non-banking finance companies such as L&T Financial Services and Franklin Templeton Investments.
The pledged shares worth 10 crore amounts to nearly 10% of the company's equity of 1.02 billion shares. Post the repayment, promoters' debt would come down to Rs 355 crore. The promoter group led by Naveen Jindal holds 60.4% stake in the company.
"After this loan repayment, promoters' debt would more than halve from December quarter levels. The peak debt level was Rs1,151 crore. This means promoters have cut their debt by almost 70% in two years," a source from steel and power company told Mint.
Earlier on April 3, 2020, JSPL reported its 'highest annual crude steel production and sales figure' for March. The steelmaker said its annual crude steel production as of March 31, 2020, rose 11.9% yearly to 8.17 million tonne (MT). Similarly, its sales figure for the fiscal year ended March 2020 rose 9.6% to 7.92 MT, respectively.