L&T Finance shares rise over 5% to reach all-time high; what’s driving the rally?

The share price of L&T Finance surged over 5 per cent on Thursday’s trading session, hitting a record high of ₹179, following Bain Capital’s sale of 8.82 crore shares of the company through a block deal.

Reports indicate that Bain Capital, through its affiliates BC Asia Investment VI and BC Asia Growth Investment, is planning to fully divest from L&T Finance Holdings by selling its current stake through a block deal.

Bain Capital has sold its 3.5 per cent stake in L&T Finance, which had a market capitalization of ₹44,344.04 crore around 9:30 am.

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Details about the buyers and sellers involved in the transaction are not currently disclosed by the exchanges. However, reports indicate that BNP Paribas Financial SNC is also partaking in the transaction, divesting a portion of its stake in L&T Finance alongside Bain Capital. The deal is reportedly valued at ₹1,500 crore.

According to reports, Bain Capital and BNP Paribas are seeking to sell their combined 3.54 per cent stake in the company at a floor price of ₹169.17 per share. If accurate, this price would represent a 0.85% discount from the stock’s previous closing price of ₹170.62 per share.

Previously, Bain Capital had sold a 2.82 per cent stake, equivalent to approximately 7 crore shares, in L&T Finance for ₹910 crore in September 2023 through a block deal, executed at ₹130 per share. Following this transaction, Bain Capital’s stake in L&T Finance decreased to 1.2 per cent, while BNP Paribas Financial Markets retained a 2.43 per cent stake as of March 2024.

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As of March 2024, the company’s public shareholding stands at 34.14 per cent, while the promoters and the promoter group hold the remaining 65.86 per cent.

L&T Finance shares witnessed a notable 61 per cent increase last year, with a 15 per cent rise in just two weeks. Over the past three months, the stock has shown a 19.6 per cent uptick on charts.