Sterlite Industries offered a follow on American Depository Share (ADS) issue worth USD 1.5 billion yesterday.
Udayan Mukherjee, Managing Editor, CNBC-TV18, said the stock could slip maybe another 4-5%. “The stock may under perform in the near-term because of the large dilution which has happened,” he added.

Here is a transcript of Managing Editor, Udayan Mukherjee’s comments on CNBC-TV18. Also watch the accompanying video.

It may slip a bit more and under perform in the near-term because of the large dilution which has happened.  I don’t think it will fall too much more unless the market cracks and as you know metals is high beta and therefore if the market falls off again to 4,000 then Sterlite will fall with it as well. What the market did yesterday was probably price in some of the dilution; if you just look at Sterlite without Asarco, the American Depository Shares (ADS) yesterday does dilute earnings per share (EPS) by nearly 10%, the stock fell off 6% yesterday. So, you probably see the stock lose a bit more ground from here maybe another 4-5% but below that that is priced in and once Asarco happens maybe EPS will actually go up over the next couple of years once that is built-in.