Shares of L&T Technology Services Ltd slumped over 6% on Friday following the announcement that it has bought the Smart World & Communications division (SWC) of its parent firm Larsen & Toubro (L&T) via slump sale for a consideration of ₹800 crore.
According to company's exchange filing, the business transfer transaction is expected to be closed on or before March 31, subject to satisfaction of conditions precedent identified under the agreement.
SWC was founded in 2016 to cater to the demands in smart cities, address opportunities and provide smart solutions in the areas of end-to-end communications, city surveillance and intelligent traffic management system for the government as well as enterprises.
It has an employee base of over 700 engineers from diversified technology domains and has annual revenue of ₹1,098 crore.
Global brokerage, Morgan Stanley has maintained 'underweight' rating on the stock as it believes that the transition of SWC's domestic business to global clientele profile will weigh on sentiment.
At 10:25 IST, the shares of the company were trading at high volume of 556.8K with price loss of 6.06.
The stock has fallen 39.95% from 52-week high of 5,715.4 recorded on January 14, 2022. The company's weekly average delivery volume is 27.21%.
“After a gap down we are witnessing follow up selloff and huge volumes are as well seen, as of now traders should avoid catching falling knife as further weakness can be expected, 3300 is next support whereas 3,480 - 3,500 level is immediate resistance,” said Rajesh Bhosale - Equity Technical and Derivative Analyst, Angel One.