Market movers: Mood change at L&T over Mindtree; Tata Steel bucks market trend

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NEW DELHI: Barely three years after the L&T chief executive and managing director S N Subrahmanyan’s proclamation that there was no intention to merge the Bengaluru-headquartered Mindtree with its technology services business, it seems the mood has changed. L&T acquired Mindtree in a hostile bid in 2019.

News reports on Monday said Larsen & Toubro, which owns 61 per cent in Mindtree, is weighing its merger with Larsen & Toubro Infotech, which is another tech services subsidiary. Apparently, the Indian conglomerate seeks scale to compete with global digital giants.

An announcement may come as soon as next week, the report said.

The investors were not overjoyed with the news, it seemed. Mindtree, which also came out with its earnings post-market hours, closed down at Rs 3,956.15, down over 3 per cent. L&T Infotech slid nearly 3 per cent as well. Though, perhaps we should take the reaction with a pinch of salt as it came amid rampant selling in the market, especially the IT segment.

No split response

Even as the two-third of the market was showing different shades of red, there were some names that bucked the trend. One of those was Tata Steel, which ended up 2 per cent on NSE.

This comes after the company said its board will be considering a stock split next month. Investor response suggests they approve of the proposal. Though, fundamentally and valuation wise, a split does not change anything, but apparently who would not want to see the number of shares multiply in their portfolio!

Besides, Tata Steel has another reason to rally, continued demand for steel and rising prices, which will result in more revenue for the company.

Profits zoom, and a bonus…

Mishtann Foods which sells rice, lentils and wheat, on Monday said its net profits for the March quarter zoomed to 13 crore from 32 lakh from the same quarter, last year. This comes thanks to increased revenue for the firm.

Meanwhile, the smallcap company also announced it will be issuing bonus shares in the ratio of 1:1.

Following the announcement, investors lapped up its shares and the counter jumped over 3 per cent to end at Rs 27.75.



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