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Shares of GTL and GTL Infrastructure plunged 62 per cent and 43 per cent respectively on Monday on concerns over debt repayment, pledged shares and fund raising, despite the company's assurances it had not defaulted and that its business fundamentals remain strong.
As these stocks were part of future and options segment, circuit breaker could not be applied on them.
While GTL lost Rs 212.10, closing at Rs 127.8, GTL Infrastructure hit a 52-week low during the day's session before closing at Rs 16.85.
The decline in GTL stocks was due to rumours in the market that the promoters had sold their stake in the company, following reports to that effect last week.
“Neither the promoters nor the FDI partners of the company have sold their stake,” clarified Mr Manoj Tirodkar, Chairman, GTL.
In the case of GTL Infrastructure, there were rumours that due to the review of the Double Taxation Avoidance Agreement with Mauritius, the FDI partners of the company had sold their stake. This was also denied by Mr Tirodkar.
Another reason for the fall in the GTL Infra stock was the scrapping of the $300-million GDR issue by the company, said market analysts.
The company, in response to these reports in the media, put out a statement on the BSE on Monday.
“The Company has never launched any road show for the above said issue. We believe that the present market conditions, policy clarity on telecom sector and global market sentiments are not favourable for the issue at this stage. We would like to inform you that the Company is in highly capital intensive business and it will raise funds at appropriate times. We will keep the stock exchanges updated of any developments on this matter,” said the statement.
Analysts said that both stocks saw heavy speculation-selling but they were not forthcoming as to what the speculation was.
“The lacklustre response to the GDR issue was one of the reasons for the drop in the stock prices,” said the head of research of a broking firm.
In case of GTL, the lowest the scrip touched during the day was Rs 124.10 and the highest was Rs 328.70. For GTL Infra, the lowest was Rs 15.75, while the day's highest was Rs 29.
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