Shares rise as jeweller vows to revive Atlas

Shares of Atlas Jewellery India Ltd are set for their biggest monthly gain this year as investors bet on a quick resolution of its financial troubles now that the founder is out of prison.

M.M. Ramachandran was released on bail this month more than two years after a Dubai court sentenced him to three years for defaulting on loans. He said the company has paid off part of the money owed to a consortium of banks by selling some assets in Oman.

At a time when Indian authorities are seeking to bring to book absconding jeweller Nirav Modi for allegedly masterminding a $2 billion (Dh7.34 billion) bank fraud, investors are cheering the release of Ramachandran on hopes he may hasten debt repayment. Shares of the company surged as much as 88 per cent in June to a three-year high before paring the advance to 26 per cent as of Monday.

Since his release, Atlas has received three proposals from private equity investors from the US and India and the company will pay off all its debts, Ramachandran said. He declined to share details on potential investors or disclose the extent of his dues, but said the media has cited “all ballooned up figures and the amount is much less than that.”

Ramachandran owed about Dh550 million ($150 million) in 2015, according to a report in a UAE daily newspaper. Financial woes pushed him to close about 30 of his outlets in the UAE Oman, Saudi Arabia and Qatar, of about 48 worldwide, he said. Ramachandran, 76, plans to open a store in the UAE as a first step toward rebuilding his firm and scale these up to at least 10 outlets by 2020.