BackL&T rises to 8-month high ahead of L&T Infotech’s IPO announcement
The stock touched a high of `1,575, a level last seen on 21 October 2015, and gained as much as 2.22%
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Mumbai: Ahead of its subsidiary L&T Infotech’s initial public offering (IPO) announcement, shares of India’s largest engineering and construction company Larsen and Toubro Ltd (L&T) on Monday hit an eight-month high, gaining on the back of higher volumes for the six consecutive session.
The stock touched a high of ₹ 1,575, a level last seen on 21 October 2015, and gained as much as 2.22%. In the last six trading sessions, the stock gained 9.2% and year-to-date, it rose 22.7%.
L&T Infotech will hold a press conference on Monday after 4.30pm to announce its IPO plans.
“L&T stock has surged in anticipation of the value unlocking for the parent company from the proposed L&T Infotech Ltd’s IPO. That apart, improved business sentiment is also aiding the stock," said Deven Choksey, group managing director, KR Choksey Investment Managers Pvt. Ltd.
On 30 June, L&T said that it is looking to divest about 10.3% of its stake in L&T Infotech via an IPO which will open on 11 July and close on 13 July. The company has fixed a price band of ₹ 705-710 per share for the offering. At the upper end of the price band, the IPO size would be ₹ 1,242.50 crore.
L&T Infotech is structured around two businesses—the industrials and the services clusters. The industrials cluster caters to clients in sectors such as manufacturing, energy and utilities, hi-tech and consumer electronics, automotive and aerospace, engineering and construction. The services cluster focuses on banking, financial services, insurance, travel and logistics, media and entertainment and healthcare.
The company has hired Citigroup Global Markets India Pvt. Ltd, Kotak Mahindra Capital Co. Ltd and ICICI Securities Ltd to manage the share sale.
Shares of L&T closed 1.59% higher at 1,565.20, a level last seen on 20 October 2015, while India’s benchmark Sensex index rose 0.49% to 27,278.76 points.
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