HCL Infosystems Ltd up 12% to @ Rs 51 with super volumes ~ Will BSE & NSE ask Why again?
Just under a fortnight ago on September 22,2016 HCL Info opened at @ Rs 42 & surged to Rs 48 before settling at Rs 47 on huge above average volumes with BSE clocking over 42 lakh shares and NSE trading near 1.63 cr shares
BSE & NSE had asked the Company to Clarify on whether there was any reason for this surge in Volumes & Share Price
Interestingly the Company replied instantly that “The increase in volume seems speculative in nature”
The Delivery % was just under 20
The Share Price then slid last week back to Rs under 43
Today BSE & NSE clocked even more super volumes exceeding 45+ lakh & 1.84+ cr shares respectively with Share Price shooting up 12% to close just under Rs 51
What’s Happening? Will the Exchanges in 13 days yet again ask the Company for clarification for today’s surge too & will the company reply the same that it’s seems to be speculative & will thus the share price slide back ?
52 Week H/L is Rs 66.75/30 & Market Cap is Rs 1135 crs
The Company is part of the Shiv Nadar HCL Tech Group & has undergone a Scheme of Arrangement effective January 1,2013.It has 14 unlisted subsidiaries including eight step down & one jv associate and has suffered losses in the past three financial periods which even witnessed declining topline with the last dividend being paid for FY 12.Consolidated Networth on March 31,2016 declined to Rs 1008 crs with Equity (FV Rs 2) at Rs 44.58 crs of which Rs 596 crs in reflected in Goodwill on Consolidation.There are no Non Current Investments in Consolidated Accounts.Standalone shows these at Rs 972 crs in six unquoted subsidiaries after providing for diminution (Original Investments Cost was Rs 1568 crs).Short Term & Long Term Borrowings,about evenly split at March 31,2016 aggregated 996 crs.Book Value at year end March 31,2016 was Rs 45
The Business Model is of Four Market Driven Business Units housing nine Lines of Business over Distribution,Services,Learning & Hardware Products & Solutions & the Company states in it’s FY 16 Annual Report that it will be their Core Enterprises Business of Distribution & Services that will be the engine for the next level of growth.Do remember that the Company has been contracted for UIDAI & the milestone of over 100 crs Aadhaars has been crossed.India has a population of over 125 crs.Their System Integration Business has seen many of the defence projects move towards commercial conclusion
Post the Scheme of Arrangement in 2013 HCL Info entered the Portfolios of Big Individual Equity Investors Prof S.Mankekar in 2014 & GS Damani in 2015 at @ Rs 50 levels…it’s at these levels today too
It’s interesting how Shiv Nadar & the VC & MD Premkumar Sheshadri steer the company forward to a sustainable turnaround on the wings of an asset light model.Nearly 90000 Shareholders hold this Faith & the loss is coming down too.Q1 FY 17 shows just a marginal loss
Interesting if the Exchanges again seek Company clarification for Price & Volume Dynamics that entertained on their bourses today & will they allow the Company to get away with a statement again that they feel it is speculative in nature !