Ashok Leyland in the red

Ashok Leyland is the top loser on the BSE since morning. The stock which had hit a new high yesterday at Rs.39, is down currently 4.5% at Rs.36.35.

This sudden change of mood – from high to low is after the company announced its QIP floor price at a discount to the market price, whilst the market was expecting it at a premium. The company, for the QIP, has set the floor price at Rs.34.30/share, which is almost 10% discount over yesterday’s close.

The company plans to raise around Rs600-700 crore through the QIP  and the market is also worried that this will lead to further equity dilution. The company will dilute promoters shareholding from 41.5% to 34.5% for this QIP.