Not a time to take low risk bets in equity markets: Deepak Shenoy
«And given the stock price has come down today by, I think, about 7% or 8%, there is only some open offer arbitrage that seems to be on the table,» says Deepak Shenoy, Founder, Capital Mind.You have got a chance to look at this one, Route Mobile.We are looking, to be honest, we do not know for sure if this is our full understanding yet. I think more will come after the call. The parent company is owned by, I think, the Belgian government.
They have an arm in the US. So now the promoter will actually have a 14% stake in this hold co, which owns the India and the US businesses. The only negative that might be of concern is that Route's international expansion, which has been quite strong in the last few years, has possibly ramifications if the new value creation entity is going to be the hold co and the US entity, which is, therefore, the Route's Indian shareholders may not participate in much of the subsequent international expansions.
This is the only fear that I could see. Otherwise, the price is just about market price. They will acquire, I think, 26% of the remaining, roughly 42% shareholding, at least do an open offer for it.
And given the stock price has come down today by, I think, about 7% or 8%, there is only some open offer arbitrage that seems to be on the table. Beyond that, I do not have that much information on the contours of the deal. But early days, you do not have to react on the same day itself.Still surprised by the reaction that the Street had to at best a muted set from both HCL Tech or TCS?I think everybody was surprised about that reaction which happened on Friday.
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