Monday, December 16, 2013

Special Situation : Foursoft Ltd

Recently Foursoft paid a dividend of Rs 29/- per share after selling  its business. (Here)

Four Soft

Further they have declared their intention to reduce the capital by 50 % by returning 29/- per share. (Here)

After Paying this amount, It will be left with at least Rs 25 crores, which comes to around Rs 13/-.

Today, If I buy the shares @ Rs 16.20/-, I will be entitle of Rs 29/- for 1 shares out of every 2 share , also the cash lying residual with the company will be Rs 13/-. Hence the composite cash lying with the company is at least Rs 21/- per share. 

I don't intend to give discount to cash in this case as Four Soft has successfully, proven to given to give full cash to share holders. For More Information Here

Based on above logic, I expect a return of at least 15 % in next 6 months.

This is not a recommendation to anybody whatsoever to buy OR sell this share, but it is my thought process and views on this topic.

I welcome your critical comments and suggestions.

PS : I have taken position in stock.

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