Financial Technologies (India) hit an upper circuit limit of 10% at Rs 365.75 at 10:30 IST on BSE, extending recent gains triggered by the company's plan to exit from exchanges businesses.
Shares of Financial Technologies (India) (FTIL) have risen 36.81% in four sessions from a recent low of Rs 267.35 on Friday, 18 July 2014.
Meanwhile, the BSE Sensex was down 16.84 points, or 0.06%, to 26,130.49.
On BSE, so far 4.90 lakh shares were traded in the counter, compared with an average volume of 2.67 lakh shares in the past one quarter.
The stock hit a high of Rs 365.75 and a low of Rs 341.50 so far during the day. The stock hit a 52-week high of Rs 644.40 on 24 July 2013. The stock hit a 52-week low of Rs 102.05 on 30 August 2013.
The stock had outperformed the market over the past one month till 23 July 2014, rising 29.63% compared with 4.46% rise in the Sensex. The scrip had, however, underperformed the market in past one quarter, falling 0.08% as against Sensex's 14.30% rise.
The small-cap company has an equity capital of Rs 9.22 crore. Face value per share is Rs 2.
FTIL clarified during trading hours on Tuesday, 22 July 2014, that it would like to exit from exchanges business. Accordingly, the process of divestment in exchanges is been evaluated considering all options including through IPO, the company added.
The clarification was issued after media reports suggested that FTIL is looking to exit Indian energy exchange.
As a policy, the company does not wish to comment on any speculative news reporting. As a respectable corporate, any such definitive decision will be first intimated to the exchanges, FTIL said in a statement.
Meanwhile, FTIL, before market hours on Monday, 21 July 2014, announced that it entered into a share purchase agreement (SPA) to sell 15% stake in Multi Commodity Exchange of India (MCX) to Kotak Mahindra Bank (KMBL) for a total consideration of Rs 459 crore. The final closing is subject to certain conditions to be fulfilled including regulatory approvals.
After the latest stake sale, FTIL's shareholding in MCX will come down to 5%, which is under lock-in till 7 March 2015. In a statement, FTIL said it will continue with its divestment of process to sell the balance 5% stake in MCX subject to receipt of binding bids and regulatory and other approvals.
MCX, a dominant player in commodity exchanges in India, is also an affiliate of FTIL. On 7 May 2014, the Mumbai police's Economic Offences Wing (EOW) arrested Jignesh Shah, chairman and group chief executive of FTIL, in connection with the Rs 5574.34 crore fraud at National Spot Exchange (NSEL). FTIL owns 99.9% of NSEL.
The crisis at NSEL came to light on 31 July 2013 when the exchange suspended trading in all but its e-series contracts. These, too, were suspended a week later. The suspension may have been prompted by an instruction from the ministry of consumer affairs to the exchange asking it not to offer futures contracts. A spot exchange is not supposed to do so, but NSEL was doing that. NSEL tried to implement the change, but because its appeal was to investors and members who were not interested in spot trades, it eventually had to suspend all trading.
Subsequent investigations have highlighted the possibility of fraud and, according to the Forward Markets Commission (FMC), the involvement of promoters. On 14 August 2013, NSEL proposed a payout plan, but it has been unable to stick to the schedule and has not made a single successful payout ever since.
FMC in its order dated 17 December 2013 said that FTIL, the promoter and anchor shareholder holding 26% of the paid-up capital of the commodity exchange MCX, is not 'fit and proper person' to continue to be a shareholder of 2% or more of the paid-up equity capital of MCX as prescribed under the guidelines issued by the Government of India (GoI) for capital structure of commodity exchanges post 5-years of operation.
FTIL reported a net loss of Rs 371.25 crore in Q4 March 2014 as against net profit of Rs 87.81 crore in Q4 March 2013. Net sales declined 60.8% to Rs 55.25 crore in Q4 March 2014 over Q4 March 2013.
FTIL is among the global leaders in offering technology IP (Intellectual Property) and domain expertise to create and trade on next generation financial markets.
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