Rolling settlement shares plummet

Rolling settlement shares plummet
ENS ECONOMIC BUREAU

MUMBAI, FEBRUARY 9: Shares put in the rolling settlement system by market regulator missed the stock market party and were battered down on Wednesday over concerns of poor liquidity.

"Speculators who had positions in these shares are booking profits," said an analyst, who saw the falls as an initial reaction. Shares which are slated to have rolling settlements fell, including Aftek Infosys, down Rs 257.10 to Rs 2,957.20, KLG Systel Rs 85.25 to Rs 982, Container Corporation Rs 10 to Rs 240, Torrent Pharmaceuticals Rs 26.40 to Rs 631 and Kotak Mahindra Finance Rs nine to Rs 177.

The Securities and Exchange Board of India (SEBI) said on Tuesday about 150 shares were being added in phases to a list of ten shares already being settled on a rolling basis. While the expanded list does not contain the most heavily traded shares, dealers said the move would bring down excessive speculation, leading to volumes drying up and prices declining.

"There would be value-based interest in good stocks later," said adealer. India started rolling settlements in the T+5 cycle on its exchanges in 10 stocks that are traded in the dematerialised form. In the T+5 cycle, settlements are made on the fifth working day after the trade. Trades in all other shares are conducted during a weekly trading account and are settled together one week later.

Dematerialised shares refers to scrips held in a depository and transfers are steered electronically. The bellwether 30-share Bombay Stock Exchange index hit an all-time high of 5,756.87 in early deals on Wednesday, buoyed by sustained foreign fund purchases and strong US markets.