Afcons Infrastructure shares fell to a day low of Rs 257.50 after Tata Trusts proposed a buyback of the SP Group’s Tata Sons stake.

The drop followed a proposal placed before the Tata Sons board. Tata Trusts offered to buy back part of the Shapoorji Pallonji (SP) Group’s stake in Tata Sons.

Afcons is part of the SP Group. So when there’s big news about the group’s Tata Sons holding, Afcons shares usually move too. Here’s what the plan involves.

Tata Trusts Chairman Noel Tata suggested repurchasing enough SP Group shares to raise at least Rs 25,000 crore. This would happen in two stages over 18 months.

The share pricing would follow the fair value method under Income Tax Rules. The buyback itself would go through a selective capital reduction process at the National Company Law Tribunal.

Tata Trusts also repeated a point it has made before. It wants Tata Sons to stay unlisted.

This came even after the RBI rejected the company’s request to give up its NBFC registration.

Just three days earlier, the mood on the stock was very different. On September 15, Afcons shares jumped as much as 17.7% during the day, touching a high of Rs 304.55.

That rally was driven by hopes of a Tata Sons listing, which would give the SP Group a straightforward way to cash out part of its 18.37% stake.

That optimism has faded quickly. The SP Group has a repayment of around Rs 3,500 crore due by the end of September.

It is also carrying total debt estimated at Rs 55,000 to 60,000 crore. At 10:06 am on Friday, Afcons Infrastructure was trading at Rs 261.50 on the NSE, down 2.17% for the day.

The stock has fallen close to 7% over the past month and remains down more than 33% since the start of the year.

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