HDIL Shares Snap Losing Streak On One-Time Settlement Talk
HDIL tanked 20% upon market opening, extending losses for five days.
Shares of Housing Development and Infrastructure Ltd. fell as much as 20 percent in early trade on Wednesday on concerns around insolvency proceedings against a company unit.
Stock fell for the fifth straight day in early trades before surging as much as 10 percent higher after the company’s Managing Director Sarang Wadhawan told CNBC-TV18 that the developer is in talks with its bank for a one-time settlement. The stock ended 1.4 percent higher compared to a 0.7 percent decline in the benchmark BSE Sensex.
The real estate developer said on August 3 that the National Company Law Tribunal had admitted Union Bank of India’s plea against its wholly owned subsidiary Guruashish Constructions.
HDIL had said in its 2015-16 annual report that it had secured a mortgage against properties owned by its subsidiary Privilege Power And Infrastructure Pvt. Ltd. at a rate of 14.5 percent, repayable in 20 quarterly instalments of Rs 10 lakh each.
Lord Abbett Securities and Societe Generale sold their holdings in the company via a block deal on August 7. Lord Abbett sold 30.7 lakh shares and Societe Generale sold 25.3 lakh shares, according to National Stock Exchange data.
On Wednesday, HDIL’s trading volume was 18.4 times the 20-day average on the National Stock Exchange. It has fallen more than 45 percent in the last five trading sessions. The Relative Strength Index stands at 11, indicating it may be oversold.