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Financial Technologies erodes over one-fourth value

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Capital Market
Last Updated : Aug 01 2013 | 10:30 AM IST

Financial Technologies (India) slumped 25.95% to Rs 401 at 09:36 IST on BSE after its unlisted subsidiary National Sport Exchange suspended trading of all one-day forward contracts following the recent regulatory changes.

Meanwhile, the S&P BSE Sensex was up 181.32 points or 0.94% at 19,527.02.

On BSE, 3.59 lakh shares were traded in the counter as against average daily volume of 61,588 shares in the past one quarter.

The stock hit a day's low of Rs 370 so far during the day, which is also 52-week low for the counter. The stock hit day's high of Rs 487.40 so far during the day. The stock had hit a 52-week high of Rs 1,223.80 on 13 November 2012

The stock had underperformed the market over the past one month till 31 July 2013, falling 30.39% compared with the Sensex's 0.26% fall. The scrip had also underperformed the market in past one quarter, sliding 33.07% as against Sensex's 0.81% decline.

The small-cap company has equity capital of Rs 9.22 crore. Face value per share is Rs 2.

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Shares of Financial Technologies (India) (FTIL) tumbled after its unlisted subsidiary National Sport Exchange (NSEL) announced trading suspension of all one-day forward contracts, except its so-called e-series contracts. NSEL said that it will merge the delivery and settlement of contracts (other than e-Series) and that settlement would be deferred for 15 days. However, the exchange had not changed the trading, settlement and physical delivery of e-Series contracts like e-Gold, e-Silver, etc., where trading continued as usual.

The suspension of trading in one-day forward contracts come after a series of other steps taken by the exchange, which is promoted by FTIL and National Agricultural Cooperative Marketing Federation of India, in order to comply with regulatory requirements.

Consequent to doubts raised by the Department of Consumer Affairs, Government of India over possible short-selling in certain contracts on the National Spot Exchange, last week NSEL had shifted all contracts into the trade-for-trade category, which means that every trade must result in delivery. NSEL had reduced the delivery, payment and settlement period of all contracts traded on the spot exchange to less than 11 days.

Shares of FTIL witnessed a steep slide recently. The slide gained further momentum with the stock tumbling by 9% to settle at Rs 566.85 on 26 July 2013. The stock rose 1.47% to Rs 575.20 on 29 July 2013. Thereafter, the scrip once again resumed downtrend, falling 30.29% in three trading days from a recent high of Rs 575.20 on 29 July 2013.

The company after trading hours on 26 July 2013, said bear cartels are working against the interest of the company by spreading a number of malicious rumours and warned that the company reserves its rights to take necessary legal action, including complaining to stock market regulator Securities & Exchange Board of India (Sebi) and all other relevant authorities to investigate and take necessary action into this malicious campaign against the company.

The series of rumours that are spread in the market have a pattern more particularly to spread on Friday and such rumours are spread by some unscrupulous elements with a design to depress the share price of FTIL and damage its reputation, the company said at that time in its clarification to the stock exchanges.

FTIL's net profit rose 6.84% to Rs 81.20 crore on 15.44% growth in total income to Rs 169.54 crore in Q1 June 2013 over Q1 June 2012. The Q1 result was announced after market hours on Tuesday, 30 July 2013.

FTIL's earnings before interest, taxation, depreciation and amortization (EBITDA) rose 17% to Rs 120 crore in Q1 June 2013 over Q1 June 2012. The company's profit before tax (PBT) surged 32% year on year (YoY) to Rs 110 crore in Q1 June 2013.

Commenting on the company's Q1 performance, Dewang Neralla, Whole Time Director, Financial Technologies said, "This has been a steady for Financial Technologies. We booked total income of Rs 169 crore and PBT of Rs 110 crore for Q1 June 2013, an increase of 31% over Q1 June 2012. IEX leads the electricity markets with dominant share of 97% in Day ahead trading for quarter ended 30 June 2013. IEX recorded an average daily volume of 78,347 MWh in Day ahead, trading for quarter ended 30 June 2013, a growth of 69% YoY. During this quarter, our international exchanges stepped up to next level; BFX recorded an average daily turnover of $175 million for the quarter ended 30 June 2013, a growth of 95% YoY. DGCX recorded an average daily turnover of $2.2 billion for quarter ended 30 June 2013, an increase of 60% over same quarter last year". Financial Technologies (India) is among the global leaders in offering technology IP (Intellectual Property) and domain expertise to create and trade on next generation financial markets, that are transparent, efficient and liquid, across all asset classes including - equities, commodities, currencies and bonds among others. The group operates one of the world's largest networks of nine exchanges connecting fast-growing economies of Africa, Middle East, India and South East Asia. The group also has five ecosystem ventures to address upstream and downstream opportunities around exchanges, including clearing, depository, information vending, payment gateway, among others.

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First Published: Aug 01 2013 | 9:52 AM IST

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