L&T drops as Govt sells stake

72 lakh shares have changed hands on the L&T counter this morning and that really makes you balk and wonder – its 2-week average volume is less than one lakh shares. The stock price tumbled down over 3% at Rs.1397 after which it recovered back to Rs.1420 levels but remains in the red.

This volatility on the counter of L&T is thanks to the Govt of India. The news is that Specified Undertaking of Unit Trust of India (SUUTI) sold 14.8 million shares, or about 1.59% stake from the 8.14% it owns in L&T. This was sold at a price of Rs.1,415.66/share.

The stake sale is part of the government's plan to raise Rs.56,500 crore from asset sales during the current fiscal year to March to help contain its fiscal deficit at 3.5% of the GDP.

The news is that it will offload a total of 3% in L&T thus we can expect more volatility on the counter.