Shares of Sterlite Technologies is trading lower nealry 10 percent to Rs 236.85 per share as sources told CNBC TV18 that there is a temporary demand-supply mismatch in China.
Shares of Sterlite Technologies is trading lower by over nearly 10 percent on Friday as the company is witnessing some pressure from the China market as there’s a delay in the China mobile tender, said the company. Anand Agarwal, Group CEO of the company told CNBC TV18 that there is a temporary demand-supply mismatch in China.
Sterlite Tech shares fell as much as 9.78 percent to Rs 234.60 per share intraday on the NSE. At 1.27 PM, the stock traded 9 percent lower at Rs 235 per share.
China Mobile's tender results have spurred price-war concerns as the order for fiber-optic cable last month sent shares of anything with a hint of 5G rallying, reported Bloomberg, citing Jefferies research note. The results of that tender showed suppliers had to bid at least 35 percent lower than the price cap to win.
However, according to Sterlite, China sales only account for 6-7 percent of the company’s total revenue. The major revenue profile is based largely in India, Europe, Middle East, and Latin America. Thus, there’s a structural shift but it’s temporary.
Speaking on the pledged shares, the management said, “The promoter pledges which has happened over the last few months is related to areas outside the purview of the company. It’s short-term, and over the next 3-6 months, all pledged shares should be released from the company.”
On the future outlook front, Sterlite Tech has maintained its guidance of 35-40 percent revenue growth for both FY19-20.