DHFL trading suspension: Anil Singhvi says a BIG LESSON for investors, urges them to be cautious with stressed companies

As the exchanges suspended the trading of Dewan Housing Finance Limited (DHFL) shares from Monday, Zee Business Managing Editor Anil Singhvi terms this move as a big lesson and urges investors to be more cautious trading with the company under IBC resolution. 

Singhvi mentioned, the investors must understand there is a 100 per cent loss of capital if investing in stressed companies and if they believe it won’t harm much investing in penny stocks. 

See Zee Business Live TV Streaming Below:

Zee Business since last week has been alerting its viewers to get out of DHFL, when the stock had it an upper circuit of 20 per cent on the back of Piramal Enterprises taking over the news. 

Cases such as of Ruchi Soya and Alok Industries are very rare, not every company would see the fate like them, said Singhvi, He added, it’s becoming clearer that companies under Insolvency and Bankruptcy Code resolution their equity value would get zero. 

आज से DHFL के शेयरों में नहीं होगी ट्रेडिंग...

अनिल सिंघवी- DHFL के शेयरों की वैल्यू अब 0, ज़ी बिज़नेस ने बार-बार चेताया भी

DHFL से सबक लें निवेशक... IBC रिजॉल्यूशन, टेकओवर और मैनेजमेंट बदलाव वाले कंपनियों में पैसा लगाने से पहले जांच लें...#EditorsTake #DHFL @AnilSinghvi_ pic.twitter.com/CqGQ71Tsty

— Zee Business (@ZeeBusiness) June 14, 2021

The market guru said, If the company doesn’t have money to pay to their bankers, creditors, and employees then on what context the equity would exist, moreover, a new promoter won’t give so much equity after taking over as it has no value now. 

Investors believe, the stressed company would grow after resolutions, perhaps it will, but will investors be benefitted from it and would the get an opportunity to make money from it, Singhvi exclaimed. 

Before concluding, Singhvi said, the damage is done now and investors need to cautious further. He added, the share market’s biggest risk is that the investors' equity would become zero anytime.