Coforge shares zoom as promoter offloads 25% stake in block deal
Coforge shares registered sharp gains amid huge trading volumes on Thursday. The Coforge stock came within Rs 16 of a 52-week high scaled last week.
Coforge shares registered sharp gains on Thursday amid reports about a likely block deal in the IT services company. The Coforge stock surged by as much as Rs 492.3, or 10 per cent, to Rs 5,403.9 apiece on BSE, coming within Rs 16 of a 52-week high scaled last week
Zee Business reported that Coforge's promoter, Hulst BV, sold 1.5 crore shares (equivalent to a 25 per cent stake) out of its 26.6 per cent holding in the IT services firm. The transaction was estimated to be worth Rs 6,961.5 crore. Hulst BV is an affiliate of Hong Kong-based investment Baring Private Equity Asia.
A floor price of Rs 4,550 per share was fixed for the deal, according to the report. It translated to a discount of Rs 361.6, or 7.4 per cent, to the previous day's closing price.
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Coforge shares settled 9.8 per cent higher for the day at Rs 5,390.9 apiece on BSE trading in huge volumes throughout the day.
Baring PE, which had acquired around 70 per cent of Coforge at around Rs 1,394 apiece in 2019, has been trimming its stake in the IT services provider for the past two years.
Here's a brief history of the promoter's stake in Coforge over the past few quarters:
|September 30, 2020||70.3%|
|December 31, 2020||64%|
|June 30, 2021||55.7%|
|September 30, 2021||50.2%|
|March 31, 2020||40.1%|
|March 31, 2023||30.2%|
|June 30, 2023||26.6%|
WHAT ANALYSTS SAY
According to Nuvama, the increase in free-float shares owing to the deal could lead to a higher weightage in the FTSE index, leading to inflows of $29 million (around Rs 241 crore).
Free-float refers to the amount of shares that can change hands publically in the normal course of trading.
A double-upgrade from Jefferies to 'buy'
Jefferies double-upgraded Coforge to 'buy' from 'hold' and raised its price target for the stock by Rs 2,100 to Rs 6,250 apiece, suggesting an upside of 27.2 per cent from Wednesday's price.