The weekly average volume for the week ending August 11, was around 1.69 lakh shares with price hovering around Rs 750-770, but immediately after listing of shares on NYSE ( converting GDR into ADR ), volumes shot up to 533112 lakh shares by next Friday. On August 18, around 1,32,000 shares changed hands on Bombay Stock Exchange, while the corresponding figure for NSE was around 1.82 lakh which is a record of sorts for the company which has never seen such high volumes in recent past. The volumes have been around 47,000 shares on August 21, with scrip closing at around Rs 861.
In spite of such huge growth in volumes, there has been no significant change in prices which continued to hover in Rs 750 to 830 range before it rose to around Rs 900 and later settled back to its previous level.
Market watchers say there has been no significant institutional buying, while operators continue to be active on the counter. This could be the probable reason for such high activity witnessed recently. In fact on August 16 immediately after NYSE listing, the total volume on BSE and NSE stood at around 3.58 lakh shares, a huge rise compared to the volumes seen on August 14 of around 1.3 lakh shares on both the exchanges.
Foreign institutional investors (FIIs) have lately been apprehensive on this particular stock because of end of the monopoly over international traffic that it enjoyed till recently. But it is likely to lose this status by 2004, without any proper compensation announced by the Department of Telecommunications. The department is seriously considering some sort of compensation mechanism for the state-run telecom major, including waiver of license fee for long distance telephony .