The Global Trust Bank stock is likely to be extinguished after the merger of the Hyderabad-based bank with the Oriental Bank of Commerce (OBC).
Under the amalgamation scheme, there will not be any swap ratio and shareholders of GTB will not be eligible for OBC shares. In order to prevent any manipulation in the stock, the exchanges put it in the trade-to-trade category today.
According to market rumours, there was some buying from people close to the promoter group and from investors who are apparently under the impression that GTB shareholders will get OBC shares. Sources said that there was buying from areas like Ludhiana on Monday. Sources in exchanges said they were closely monitoring the scrip to find if there is any manipulation.
On Monday evening, BSE and NSE had decided to put the GTB stocks under the trade-to-trade category. This was done after a meeting with the market regulator, the Securities and Exchange Board of India (Sebi).
The market is perplexed that there is any buying interest in the stock at all, despite the fact that it has lost its value. The banks equity capital and reserves will be used for meeting the depositors liabilities.
Suprisingly, the stock, which may soon become worthless, witnessed huge volumes. Over 2 crore GTB shares were traded on the Bombay and National stock exchanges. About 1.43 crore GTB shares were traded on the NSE, while 80.08 lakh shares changed hands on the BSE.