BackL&T shares open sharply lower after series of block deals
The stock opened at Rs1,422 and touched a low of Rs1,397 a share, a level last seen on 24 June
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Mumbai: Larsen & Toubro Ltd, India’s largest engineering company, on Friday witnessed a series of block deals in which around 7.95 million shares or 0.9% stake of the company changed hands, Bloomberg reported. Details of buyers and sellers were not available.
The stock opened at Rs1,422 and touched a low of Rs1,397 a share, a level last seen on 24 June. It fell as much as 3.3%, its steepest fall since 12 September. The stock fell in nine out of 10 trading sessions and was down 7.5% in this period. So far this year, it rose 11.1%.
Shares of L&T had opened sharply lower after Mint on Thursday reported that the Specified Undertaking of the Unit Trust of India (Suuti) will pare its holding in L&T through a block deal.
Suuti is looking at selling up to 3% in L&T through the block deal and the stake sale will fetch the government around Rs4,000 crore.
As of September quarter, Suuti holds 8.32% stake in L&T.
Investment banks Citi, Morgan Stanley and ICICI Securities Ltd are advising Suuti on the stake sale.
The company has not announced yet its earning date for the September quarter. However, according to estimates of 18 Bloomberg analysts, the company may post a net profit of Rs783.90 crore, while net sales will be at Rs24,057.70 crore.
The government has considered selling Suuti assets several times in the past.
This time, the decision has been driven by the need to meet an ambitious divestment target and a conducive market environment.
The government has set a divestment target of Rs56,500 crore for 2016-17, of which Rs36,000 crore is expected to come from minority stake sales in state-owned firms. The remaining Rs20,500 crore is expected to be raised through strategic sales in both profit-making and money-losing state-run companies.
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