Infosys shares continued their downward spiral on Friday to end with a weekly loss of almost 4 percent as investors viewed the company losing its multi-million dollar Royal Bank of Scotland (RBS) project with concern. The BSE Sensex ended 46 points lower at 28,077.
The Infosys stock closed at Rs. 1,021.10 on Friday on the Bombay Stock Exchange (BSE), a fall of 3.98 percent from its previous Friday close of Rs. 1,063.30. In intra-day trade, the stock plunged to Rs. 1,019, almost near to its 52-week low of Rs. 1,012.25.
Last Saturday (August 13), the Bengaluru-based IT software services exporter had said in a statement that RBS had scrapped a project to spin off and list Williams & Glyn (W&G) as a separate entity. Infosys, along with IBM, had won a project in September 2013 to develop computer systems for W&G for an estimated Rs. 2,500 crore.
Infosys had deployed about 3,000 people on the project as the technology partner.
"Infosys has been a W&G program technology partner for Consulting, Application Delivery and Testing services, and subsequent to this decision, will carry out an orderly ramp-down of about 3,000 persons, primarily in India, over the next few months," the company had said in the statement.
"The Royal Bank of Scotland announced last week that it will no longer pursue its plan to separate and list a new UK standalone bank, Williams & Glyn (W&G), and instead will pursue other options for the divestment of this business. RBS is a key relationship for Infosys and the company looks forward to further strengthening our strategic partnership and working with them across other strategic and transformation programs," Infosys added.
The BSE Sensex ended with losses on Friday after Thursday's 118 point rally.
Top Sensex losers included Coal India, TCS, Lupin and Wipro, while stocks that lifted the 30-scrip benchmark equity index included State Bank of India (up 4.15 percent at Rs. 258.50), Tata Steel and Cipla.
The week saw private sector lender RBL Bank's initial public offering (IPO) commencing. The public issue will remain open till August 23.
The bank raised Rs. 364 crore from anchor investors by issuing shares to 28 anchor investors at the upper price band of Rs 225. The bank's track record on the loan front is considered sound because of its client profile.
"Market experts are of opinion that the bank has stayed away from stressed sectors such as steel, power as well as infrastructure, which has helped it to maintain its asset quality at better levels compared to its peers," Dynamic Levels said in its IPO note.