Thank you @luckbychance for starting this thread. For easy reference, I am pasting here from the “Smallcap hunters” thread, a couple of posts related to the recent preferential issue at Rs 110 price by Creative Newtech:
In continuation of this discussion, I would like to give an example of another company that I am invested in. They waited for an ongoing upmove to stabilize before going ahead with the preference issue pricing—quite friendly to the minority shareholders.
I feel around Rs 150 to even Rs 200 could have been a reasonable price. Such preferential issue price acts as a support level for the stock price but now this support has been set too low. Even though prospects of the company look bright, the low issue price can become a self-fulfilling prophecy if there are large market corrections.
