When the open offer, mandatory under Sebi guidelines, opens in around a month (Sebi's approvals being the conditional factor), the retail investors will have to be given preference for allotment under the takeover code.

The institutions stake, in proportion, will have to be rejected even if they try to sell out to the open offer, because they hold huge percentages of stake. The total stake in Raasi Cements held by financial institutions is estimated at 20 per cent, led by UTI at 10%.

Meanwhile, while they miss out on the open offer price of Rs 300, the FIs will be left holding their shares whose values will definitely dip in the marketplace in the short run as the Rajus have clearly rubbed out the option of a counter-bid that could possibly top Rs 300.

The FIs are, thus, losingout huge notional capital gains that they stood to make otherwise. It appears that the average cost of acquisition of Unit Trust of India's holding, for example, was a cheap Rs 12. The total notional loss to the UTI, if one were to calculate the difference between the market cap of their holding in Raasi at the offer price of Rs 300 and at the market price of Rs 180, would be around Rs 20 crore.

Other institutions which hold stakes in the company are Life Insurance Corporation, Industrial Development Bank of India, GIC and some nationalised banks.