L&T Finance Holdings shares decline 7% near 52-week low on divestment of Asset Management business

Amid heavy volumes, L&T Finance Holdings’ shares skid near a 52-week low level to Rs 76.7 per share, down over 7 per cent on the BSE intraday trade on Friday. The decline in the stock is witnessed after the company announced divestment of its Asset Management business on Thursday post-market. 

The share of the company backed by Larsen & Toubro (L&T) Group had hit a 52-week low of Rs 71.55 per share on Monday, December 20, 2021, while, on March 3, 2021, it had touched a 52-week high of Rs 113.40 per share. 

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Minutes after the market open, the stock tumbled and has been frozen between 76-77 per share level for almost all sessions. At 02:10 pm, the scrip is down 6.36 per cent to Rs 77.35 per share, as against to 0.26 per cent decline in the S&P BSE Sensex.  

L&T Finance Holdings (LTFH) and HSBC Asset Management (HSBC AMC) have entered into a definitive agreement, whereby the latter will acquire 100 per cent equity shares of L&T Investment Management for USD 425 million (about Rs 3,192 crore), the company said in an exchange filing. 

L&T Investment Management (LTIM), a wholly-owned subsidiary of LTFH, is the investment manager of L&T Mutual Fund. 

The transaction is subject to the requisite regulatory approvals and both the companies will work to ensure that there will be continuity of services to their investors and counter-parties in the interim. 

The company in a statement said, “The divestment of Mutual Fund business is in line with the strategic objective of L&T Finance Holdings of unlocking value from its subsidiaries to strengthen its balance sheet.” 

LTIM is the 12th largest Asset Management Company (AMC) in India and offers a basket of equity, fixed income and hybrid schemes to both retail and institutional investors.  

With a technologically advanced and robust risk monitoring and management framework, together with an experienced investment team, the company has built a long-term, stable and strong retail investor base that comprises 64 per cent of its overall Asset Under Management (AUM).