{
  "id": 5275353,
  "title": "ITC's big bet makes this stock lose its happy space",
  "url": "https://urgent.news/2026/09/03/itcs-big-bet-makes-this-stock-lose-its-happy-space",
  "topic": "finance",
  "section": "Finance & Markets",
  "published": "2026-09-03T01:16:45.000Z",
  "source": {
    "name": "The Economic Times",
    "slug": "the-economic-times",
    "url": "https://economictimes.indiatimes.com/markets/stocks/news/happiest-minds-faces-a-bumpy-ride-as-many-on-d-street-unhappy/articleshow/133722904.cms"
  },
  "original_language": "en",
  "account": "HMT, a software company, has experienced a significant drop in its stock price for the last five trading days, erasing its three-month growth of 21%. The decline has been attributed to uncertainty surrounding the integration with ITC Infotech (ITCI), a major stakeholder in the company. On Thursday, the stock managed to recover, reaching its daily high of Rs 359 on the BSE. ITCI initially intends to acquire a 22.1% stake from HMT promoters for ₹1,330 crore in cash, which is short of the 25% threshold needed to initiate an open offer. While the minority shareholders will receive proportionate shares in ITCI, they will not receive any cash from the sale. The combined entity is anticipated to enhance profitability and profitability due to business synergies. However, HMT's stock is expected to face pressure in the short term. The deal consists of two steps; in the first step, HMT's management control will remain with the promoters even after ITCI acquires a 22.1% stake, funded through a rights issue. In the second step, shareholders will receive 25 ITCI shares for every 81 shares held. After the merger, ITC will own 73.4% of the combined entity, which will list on exchanges without an initial public offering. According to a research note, the merged entity will have a revenue of ₹7,033 crore in FY26, making it the 11th largest software company in the country. The merger is expected to strengthen the combined entity's ability to bid for larger deals, as HMT specializes in banking, finance, EdTech, and healthcare, while ITCI focuses on consumer, hospitality, and manufacturing verticals. However, HDFC Securities has downgraded HMT's stock to \"Add from Buy\" and reduced the target price from ₹440 to ₹400, citing the lack of takeover premium and uncertainty due to the longer integration period of 15 months.",
  "summary": null,
  "key_points": [],
  "editors_take": null,
  "illustration": null,
  "coverage": {
    "outlets": 1,
    "also_reported_by": []
  },
  "ai_generated": true,
  "disclaimer": "Summaries, key points and the editor’s take are written by software from other outlets’ reporting and may contain errors — always check the linked original."
}