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For the second consecutive day on Wednesday, the L&T Finance Holdings (LTFH) stock closed above its IPO price. The stock also recorded its lifetime high of Rs 54.85 on the NSE since it got listed in August last year. Analysts said this was part of the larger trend of financial services companies putting up a good show, owing to the change in the investment mood in the market.
Stock market analysts said that the current gain in the stock could be seen “as a run-up to the results” which are to be announced on October 19.
The stock ended the day at Rs 54.45 on both the NSE and the BSE, gaining about 2.5 per cent and 2.3 per cent respectively . It gave out a return of 26 per cent in 2012. Of late, trading volumes have also been on the rise.
The company came out with a public issue at an offer price of Rs 52 a share.
“The company is doing well compared to the other financial services companies. The results for the second quarter results are expected to be good. Investors are happy that even though the stock did fall below its IPO price, it never fell below Rs 40,” said Madhumita Ghosh, Head of Research, Unicon Financial Intermediaries. She added that the recent acquisition of Indo-Pacific Housing Finance at Rs 110 crore also held the company in good stead.
A report by Credit Suisse said that the company has a significant advantage over others in its peer group owing to a diverse loan-book and a strong parentage and should be among the frontrunners to obtain a new banking licence.
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