MUMBAI: Crest Animation Studios has seen a change in its shareholding composition after it raised $5.8 million via global depository receipts (GDRs) early this year.

The GDR holding in Crest has fallen from 42 per cent to 26.3 per cent as higher price in Indian markets provided arbitrage opportunities.

The GDRs were issued at a conversion price of Rs 35 per share. Since then, the market has responded positively and Crest is currently quoting at around Rs 78 per share.

By June, 2004, the GDR holding had fallen marginally to 39.35 per cent. While the foreign institutional investors (FIIs) held 6.57 per cent, mutual funds had 1.45 per cent. But with the stock price surging ahead, mutual funds have shown keen interest in the last two months. There has been an appreciation of over 60 per cent in the stock since 2 August when it was quoting at around Rs 48.75 levels.

"The public holding has gone up. Indian mutual funds have increased their exposure," says Crest vice-president of corporate strategy and finance Abhay Bhalerao.

The promoters' holding has gone down since the GDR issue from 32 per cent to 15.6 per cent in the company. However, their stake will go up by 5 per cent, as the warrants get converted in March, 2005.

"The promoters had taken a substantial dilution as they wanted to raise funds to restructure their business and focus wholly on animation," says Bhalerao.

The proceeds of the GDR were entirely capitalised in the US subsidiary, RichCrest Animation, USA, for expanding operations and developing original animation content. The parent company in India, however, has received close to $5 million as outsourced orders from RichCrest since the GDR issue.