India Infoline surges on plan to divest entire stake in Sri Lankan subsidiary

India Infoline surged 4.15% to Rs 63.95 at 15:02 IST on BSE after the company said it proposes to sell its entire 76% stake in its Sri Lankan subsidiary for a total consideration of Sri Lankan rupee 50 million.

The announcement was made during trading hours today, 6 January 2014.

Meanwhile, the S&P BSE Sensex was down 60.78 points or 0.29% at 20,790.55.

On BSE, so far 60,000 shares were traded in the counter as against average daily volume of 56,356 shares over the past one quarter.

The stock hit a high of Rs 64.65 and a low of Rs 61.50 so far during the day. The stock had hit a 52-week high of Rs 90.90 on 7 January 2013. The stock had hit a 52-week low of Rs 40 on 1 August 2013.

The stock had underperformed the market over the past one month till 3 January 2014, declining 5.17% compared with the Sensex's 0.02% fall. The scrip had, however, outperformed the market in past one quarter, surging 20.39% as against Sensex's 4.77% rise.

The company has equity capital of Rs 59.12 crore. Face value per share is Rs 2.

India Infoline (IIFL) said that the company proposes to divest its entire 76% stake in its Sri Lankan subsidiary namely IIFL Securities Ceylon (Private) Limited, which is engaged in stock broking activities at Colombo Stock Exchange, for a total consideration of Sri Lankan rupee 50 million to its Sri Lankan joint venture partner who is holding 24% stake. In this regard, both the parties have entered into agreement and set the timeline of 31 March 2014 for the conclusion of the sale, IIFL said.

Separately, IIFL after market hours on Friday, 3 January 2014, said that its subsidiaries namely India Infoline Distribution Company (IIDCL) and IIFL Investment Adviser and Trustee Services (IIATSL) have received approvals from the Securities & Exchange Board of India (Sebi) to undertake investment advisory services. Commenting on this, Mr. R Venkataraman, Managing Director, IIFL said: "We are delighted to receive the approval from Sebi to act as investment advisers. IIFL believes that going forward, the advisory services platform poses enormous opportunities for servicing our large client base in the new regulatory framework".

As per the group restructuring process already underway, IIFL's 'Financial Services Undertaking' comprising broking, DP, PMS, investment banking, distribution and related business is under the process of transfer to IIDCL through court and regulatory approvals, which is in its final stage and upon its expected completion within this financial year, will enable total segregation of the financial services business of IIFL into IIDCL. The appointed date for the transfer is 1 April 2013, IIFL said in a statement.

India Infoline's consolidated net profit rose 0.8% to Rs 66.38 crore on 4.6% growth in total income to Rs 683.46 crore in Q2 September 2013 over Q2 September 2012.

The India Infoline group offers advice and execution platform for the entire range of financial services covering products ranging from equities and derivatives, commodities, wealth management, asset management, insurance, fixed deposits, loans, investment banking, Government of India bonds and other small savings instruments.

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