Shares of Cyient Ltd. surged to hit a four-month high after it sold 14.5% stake in its arm, Cyient DLM Ltd., through block deal on the BSE.
The company approved the sale of up to 1.15 crore equity shares of its subsidiary, according to an exchange filing on Tuesday.
A large trade of the 1.15 crore equity shares happened on BSE on Wednesday at Rs 765.5 per share, a discount of 2.92% from its previous closing price, according to Cogencis.
The company will utilise proceeds of this transactions towards its capital requirements, including but not limited to key investments in its recently announced semiconductor business to support growth, various organic and inorganic investments and retirement of debts.
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Shares of Cyient rose as much as 5.95%, the highest level since April 18, before paring gains to trade 2% higher at Rs 1,973.60 apiece, as of 9:50 a.m. This compares to a flat NSE Nifty 50.
The stock has fallen 14% year-to-date and risen 20.4% in the last 12 months. Total traded volume on the NSE so far in the day stood at 1.85 times its 30-day average. The relative strength index was at 71.5, indicating that stock may be overbought.
Out of 21 analysts tracking the company, 12 maintain a 'buy' rating, six recommend a 'hold' and three suggest 'sell', according to Bloomberg data. The average 12-month analysts' consensus price target implies a downside of 0.7%.
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