Block deal: Mphasis shares drop 4%; turnover tops Rs 7,000 crore; Blackstone likely seller

Shares of IT firm Mphasis Ltd tanked 4 per cent in Monday's trade as Blackstone was reportedly looking to sell a 10.6 per cent stake through block deals today. Business Today could not independently verify the report. Mphasis shares were supposed to be sold at a base price of Rs 2,350 per share, CNBC TV-18 said citing sources. The base price was at a 5 per cent discount to Mphasis' Friday's closing. Blackstone owned 55.45 per cent stake in Mphasis at the end of March quarter.

Following the report, the stock fell 3.69 per cent to hit a low of Rs 2,381 on BSE. A total of 2.98 crore shares worth Rs 7,048.45 crore changed hands on NSE. The average target price on the counter, as per publicly available data with Trendlyne, stands at Rs 2,453. The stock up 11 per cent in the past one month. Yet, it is down 10 per cent year-to-date.

The base transaction was valued at Rs 4,700 crore, as per the CNBC TV-18 reported. Quoting sources, it said an upsize option could expand the stake sale in the Bengaluru-based company to 15.1 per cent, potentially raising the total deal value to Rs 6,697 crore. The deal, as per the report, included a 180-day lock-in period for the shares involved. BCP Topco, a private limited company incorporated in Singapore, is linked to the major private equity firm Blackstone, it added.

The Mphasis management aims to sustain EBIT margin band of 14.6-16 per cent in FY25, while investing for growth with focus on productivity, efficiencies and operating leverage. Anlaysts said the utilisation, pyramid, offshoring and operational leverage are key margin levers for Mphasis, adding that headcount will move in line with demand going ahead, as current utilisation levels are comfortable for its management.