Amid stock market carnage, two companies of debt-laden IL&FS group surge up to 10%

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Published: October 5, 2018 1:49:06 PM

Even as benchmark indices - Sensex and Nifty - continue to plunge, two companies of debt laden IL&FS surged as much as 10 percent Friday after newly appointed board assured to take necessary measures to set things right at the crisis-hit group.

The shares of IL&FS Engineering and Construction Company touched its upper circuit limit of Rs 25.32, up 10 percent. (Reuters)

Even as benchmark indices – Sensex and Nifty – continue to plunge, two companies of debt laden IL&FS surged as much as 10 percent Friday after newly appointed board assured to take necessary measures to set things right at the crisis-hit group. The shares of IL&FS Engineering and Construction Company touched its upper circuit limit of Rs 25.32, up 10 percent over its previous closing price of Rs 23.02. Similarly, the scrip of IL&FS Investment Managers climbed by 5 percent to hit its upper circuit limit of Rs 10.39 on the BSE.

Also read: Share market LIVE updates: Sensex plunges 500 points, Nifty tests 10,400; all eyes on RBI monetary policy

The benchmark BSE Sensex fell over 500 points to an intra-day low of 34,663.86 points in mid-afternoon trade deals on Friday while the NSE Nifty tested the 10,400 level. The equity markets extended their losses on caution ahead of the outcome of the RBI MPC meet due at 2 pm. Oil and gas stocks continued to drag the equity markets lower, coupled with negative global cues and a weak rupee.

Meanwhile, the government will mull action against the ex-directors of the debt-ridden group if their active role in any irregularity at the debt-laden company is established by investigative agencies, official sources told FE. Finance Minister Arun Jaitley was briefed by corporate affairs secretary Injeti Srinivas on Thursday on various aspects of the IL&FS crisis.

Jaitley was briefed on the government’s move to supersede the IL&FS board and steps being initiated to prevent the contagion from spreading to the broader financial system. Sources had earlier said state-run banks, being the largest lenders, might consider the possibility of restructuring certain outstanding loans to IL&FS.

IL&FS owes Rs 57,000 crore of its Rs 91,000-crore debt to state-owned banks.

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