McNally Bharat to benefit from strategic investment: Prakash Diwan

In a chat with ET Now, Prakash Diwan, Director, Altamount Capital, shares his view on McNally Bharat. The company has raised Rs 100 crore at Rs 100 per share through preferential allotment. The allotment price was 26 per cent higher than its Tuesday's closing price.

ET Now: What is your view on EMC acquiring a strategic stake in McNally Bharat? EMC has made an additional equity investment of Rs 100 crore in the company via preferential allotment.

Prakash Diwan: But do you get a chance to dip into? I do not think so.

ET Now: But the McNally Bharat business otherwise will benefit?

Prakash Diwan: Absolutely. This is what some of the superior peers TRF have done wonderfully well. The company has always been plagued by issues of capex. It could could not revitalise or modernise itself. There are some marquee investors who have backed this company. So, it has always been a darling of sorts from an investment perspective, not from a return on equity (ROE) perspective. But this could change because the reserves could probably be the big cushion for…