Hi Chamith after a long time.
Im sorry, some share issues are not underwritten. If they are confident about subscription or have plans to get other funds they do not do it. The other things are, ♦ if a giant like JKH did it that shows they are not confident about the success ♦ they have to pay lot of money to the underwriters.
JKH warrants were NOT underwritten.
5. The Company has not entered into any underwriting agreement in relation to this issue of shares. In the event of an under-subscription, the Company will fund its investment through increased debt and alternative funding sources. In the medium term, this will include internally generated funds
SLBoy wrote:Option 4. Reduce the conversion price of the warrant.
Option 5. Introduce share split or any other investor encouraging announcement.
Option 4. - This will drag down the price of main share instantly and the total value (market cap) of JKH will go down. Hence they will never do it.
Option 5. I feel now it is too late for such a thing. Sometimes they may try.
They have just 5 months more.
As I said earlier, the environment of the country was much different when they decided to issue these warrants at these conversion prices. This is the major problem at the moment to attract investors. But, I think as this is attractive for long term institutional investors and funds they will subscribe.
The high, low prices of the shares of the Company taken into consideration for warrant issue during the preceding three month period .
June 2013 : 285.00 - 248.00
July 2013 : 273.20 - 240.00
August 2013 : 270.00 - 204.00