Shares of GTL LTd. and GTL Infrastructure Ltd. plunged in early hours of trade on Monday amid a massive spurt in traded volumes amid media speculation that promoters have sold shares in the open market. However, the company's Chairman and MD denied any problem with the two companies' business.
Meanwhile, reports last week had stated that GTL Infrastructure, which was seeking to raise about US$300mn from institutional investors, had scrapped its fund raising plans due to adverse market conditions.
GTL lost 62% to end at Rs 127.80 after hitting a new 52-week low of Rs 124.10 on BSE. It opened at Rs 320 and touched a day's high of Rs 328. Trading volumes soared to 22.19mn shares versus a two-week average of just 46,000 shares.
GTL Infra closed down by 43% to close at Rs 16.85 after touching a 52-week low of Rs 15.75 on BSE. It had opened at the day's high of Rs 29. About 45.76mn shares changed hands at the counter on BSE as against a two-week average of 91,000 shares.
The GTL stock had fallen by over 16% on Friday to end at Rs. 339.90 on the BSE. The stock had also touched a 52 week low of Rs. 316.45 intraday on Friday.
Manoj Tirodkar, Chairman and Managing Director of GTL described the fall as a wild speculative attack on the stocks.
In an interview to a television channel, Tirodkar denied that the slide had anything to do with sale of pledged shares (in GTL) or Technology Infra dumping shares in GTL Infrastructure.
GTL shares pledged with lenders have not been sold, Vikas Arora, senior vice president of corporate affairs at GTL Ltd. was quoted as saying.
GTL is examining the reasons behind the stock plunge, he said.
“There is no adverse development in the company and we are examining the reasons behind the stock plunge,” Arora was quoted as saying.
In April, GTL had informed the exchanges that the company had invested Rs 15bn in Chennai Network Infrastructure Ltd. (CNIL), a special purpose vehicle formed of GTL Infrastructure Ltd. (GIL), to purchase a portfolio of 17,500 telecom tower assets from Aircel Ltd., Aircel Cellular Ltd. and Dishnet Wireless Ltd. (Aircel).
The deal is expected to be completed in July.
Mauritius-based Technology Infra holds 23% in GTL Infra. Technology Infra is classified as foreign direct investment (FDI) in GTL Infra's prospectus.