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Sterlite Tech surges 5% on QIP, sets Rs 613.69 floor price
Sterlite Tech shares jumped 5% on a QIP launch with a Rs 613.69 floor price. The final price will gauge institutional appetite for telecom infrastructure stocks.
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Sterlite Technologies shares jumped 5% in early trading Tuesday after the company launched a qualified institutional placement (QIP) with a floor price of Rs 613.69 per share, according to an exchange filing.
The floor price is the minimum at which shares can be sold to institutional buyers. The final allocation price is set through a book-building process and typically comes at a discount to the prevailing market price. Sterlite's stock traded near Rs 648 before the announcement, putting the floor price roughly 5% below that level. Such a discount is standard for QIPs and is designed to attract investor demand.
Proceeds from the placement are expected to be used for capital expenditure, including expansion of optical fiber and cable manufacturing capacity. Sterlite has been investing in production lines to meet demand from 5G rollouts and broadband expansion in India. The company is one of the country's largest optical fiber manufacturers, supplying both domestic and international telecom operators.