Tata Communications share fell nearly 8% in early trade today despite the Tata Group firm reporting a five- fold rise in Q3 profit. The slide in the stock can be attributed to reports that government will sell its entire 26.12% stake in Tata Communications through an offer for sale and strategic sale route in the current fiscal.
The government is expected to rake in Rs 8,400 crore from the stake sale.
The large cap stock has fallen after 4 days of consecutive gain. Tata Communications share opened with a loss of 4.69% today at Rs 1076.95 on BSE.
It touched an intraday low of Rs 1,040, falling 7.96% against previous close of Rs 1,129.95 on BSE.
The share trades higher than 50 day, 100 day and 200 day moving averages but lower than 5 day and 20 day moving averages. The share has gained 139.89% in one year but fallen 4.02% since the beginning of this year.
Market cap of the firm fell to Rs 30,071 crore. The share hit 52 week high of Rs 1168.80 and 52 week low of Rs 205.70 on BSE.
Net profit rose to Rs 309.41 crore in Q3 compared to Rs 58.85 crore in the same period last year. The surge in profit was attributed to cost efficiencies and improved business processes as well as higher deferred tax credits during the quarter under review.
The profit in sequential terms, however, was down 19.6 per cent from Rs 384.81 crore in September quarter of the current fiscal.
Consolidated revenue from operations in Q3 FY21 was marginally down 0.1 per cent to Rs 4,222.83 crore from Rs 4,228.72 crore in Q3 FY20, as drop in voice business offset growth in data business. On quarter-on-quarter basis, it was down by 4.1 per cent from Rs 4,401.08 crore in Q2 FY21.
Meanwhile, Big Bull Rakesh Jhunjhunwala has bought over 1% stake in the firm. According to the latest shareholding filed by the company, Rekha Jhunjhunwala held a 1.12 per cent stake, or 3.2 million shares, in Tata Communications at the end of Q3. As of September, her name did not appear among the shareholders.