ICRA soars on share buy back, ahead of board meet
The well-known credit rating agency, investment information and credit rating agency (ICRA) gained as much as 11 per cent during the first hour of Tuesday morning, as the company's announcement of buying back shares came in.
While the benchmark indices are struggling to stay above its previous day closing, ICRA rose as much as 11 per cent to make a high of Rs 4,540.00 per share on Tuesday. The company has announced the proposal of buy-back of equity shares of the company in its upcoming board meeting which will be held on February 9, 2017.
At present, the promoters of ICRA holds 50.06 per cent stake with Life Insurance Corporation of India holding about 11.92 per cent followed by a few mutual funds holding 10.67 per cent with other individual shareholders holding as much as 7 per cent. Reportedly, foreign portfolio investors are also holding 8.60 per cent of the company's shares.
The size and other details of the proposal is yet to be disclosed. Usually, buying back of company's own shares is considered to be a good sign among investors as the company itself shows confidence in its profitability and hence considers buying back its own shares instead of investing the excess capital of their balance sheet in some other project.
At present, shares of ICRA is trading above its 50 and 200DMA of 3,987.56 and 4,010.84, which indicates bullishness. It would be interesting to watch out if the company continues this move or witnesses some profit booking from here.