Shares of Financial Technologies (India) Ltd and Multi Commodity Exchange of India Ltd rallied with strong volumes in Wednesday's session on reports that a senior FTIL official confirmed that several leading technology providers including Infosys, Cognizant Technology Solutions and Larsen & Toubro infotech had approached the company for a strategic partnership.
After opening in red and trading below its Tuesday's close of Rs 382.6 for the first half of the Wednesday's session, FTIL stock suddenly jumped from Rs 373 to Rs 396.65 in a matter of 15 minutes. The surge was witnessed after several media reports indicated that companies like Reliance Industries, Cognizant technology Solutions, L & T Infotech and Thomson Reuters have shown interest in FTIL citing Jignesh Shah. It was also reported that FTIL is looking to dilute up to 26% stake to a strategic partner and may also consider selling the stake at a discount to the market price.
However, a company spokesperson denied that Shah or any authorized spokesperson have made such statements. “ We would like to categorically deny that Mr Jignesh Shah or any other FTIL authorized spokesperson have made any such statement to media as reported in some TV channels. Also he has not named any company who have approached FTIL or not for strategic partnership and neither has he talked about FTIL’s stake dilution or about its pricing,' read an e-mail response by FTIL.
After rallying as much as 4.8%, the FTIL stock closed at Rs 395.20, up Rs 12.6 or 3.3%. MCX, a FTIL group company also closed up 3.9% at Rs 540.65 on Wednesday.
The speculations have added to the recent momentum of FTIL stock which has gained more than 18% in the last one week after a unit of bank of America Merrill Lynch bought 4.99 lakh shares in two bulk deals amounting to Rs 17.95 crore.
FTIL- the technology provider of trading software ODIN- recently announced formation of a restructuring committee. The holding company of the Rs 5600 scam ridden National Spot Exchange (NSEL)) took this measure primarily to sell upto 24% stake in MCX following an order by the Forward Market Commission (FMC), the commodity market regulator. In light of the NSEL scam, FMC has deemed FTIL and certain officials as not “fit and proper”