AMALGAMATION OF MINDTREE LIMITED: IMPLICATIONS ON YOUR F&O POSITIONS.

L&T InfoTech(LTI) and Mindtree have merged into LTIMindtree. Record date fixed is of November 24, 2022 for the purpose of issuance and allotment of new merged entity shares to shareholders of Mindtree. They will be issued shares of LTI in the ratio - 73 shares of LTI for every 100 shares of Mindtree.

1. What will happen to F&O open positions in Mindtree Limited?

- All existing contracts with expiry dates November 2022, December 2022 and January 2023 will expire on November 22, 2022.

- You can mark your existing positions for physical delivery before 11 am or square off on ICICIdirect on November 22, 2022 If neither of the above actions are completed on November 22, 2022, ICICIdirect systems will attempt to close the buy/sell Options position at 12:30 pm & buy/sell Futures position at 2:30 pm.

2. When will the new contracts be available for trade?

-  No new derivatives contracts on Mindtree shall be introduced. Mindtree will not be traded in F&O post 22nd November 2022.

3. How do I mark my Mindtree position for physical delivery on ICICIdirect and when do I require funds or shares? 

-  To mark a position for physical delivery, you need to login to your ICICIdirect account, go to open position page before 11 am and click on ‘Choose Delivery’ against each stock contract and choose for Physical Delivery.

-  You can check in Delivery Mode details after choose physical delivery. Refer snap shot below.

Example: Suppose you are long futures or short put or buy call and are looking to take physical delivery, you will need to allocate cash equivalent of the contract value in your F&O fund allocation. 

-  Suppose you have short futures, long puts or short call and you intend to give delivery of shares, you need to ensure that you have sufficient free shares of Mindtree in your demat account.

4. What if for some reason like lack of liquidity my position couldn’t be squared off for November, December & January expiry contracts on November 22, 2022?

-  If for some reason like lack of liquidity etc. your position couldn’t be squared off, so In-the-money (ITM) option contract will be assigned to you. 

-  If you are holding long call options and it expires In-the-money (ITM), the contract will be assigned to you and if you don’t have funds to buy the shares, ICICIdirect will be forced to buy the stock on your behalf and sell next day. The equivalent profit or loss along with statutory charges will be passed to your account. 

-  If you are holding long put options and the contract expires in-the-money (ITM), you will have to give delivery of shares. In case the shares are not there in your demat account, it will go for auction. ICICIdirect will attempt to arrange the stock in Stock lending and borrowing scheme (SLBM) and give delivery of shares on your behalf and then sell. The loss on such transaction (difference between buy or sell) will be debited to your account. If any profit, it will be credited to your account.

5. What is the Settlement price of Mindtree on November 22, 2022?

- Mindtree Spot weighted average price from 3 pm to 3.30 pm on November 22, 2022 will be the settlement price.

6. What if the position is squared off before 3:30 pm?

- Client will receive MTM profit or loss on T+1 day.

7. What if position is not squared off on November 22, 2022?

- Physical settlement will take place & according to your FNO open positions, delivery shares payin or payout will happen.

8. When will physical settlement payin & payout happen?

- On T+2 days.

9. When will the blocked margins get released?

- On T+1 day.

We urge you to monitor your F&O positions in Mindtree and take timely action. 

Disclaimer: -ICICI Securities Ltd. (I-Sec). Registered office of I-Sec is at ICICI Securities Ltd. - ICICI Venture House, Appasaheb Marathe Marg, Prabhadevi, Mumbai - 400 025, India, Tel No : 022 - 6807 7100. The contents herein above shall not be considered as an invitation or persuasion to trade or invest.  I-Sec and affiliates accept no liabilities for any loss or damage of any kind arising out of any actions taken in reliance thereon. The securities quoted are exemplary and are not recommendatory. The contents herein above are solely for informational purpose and may not be used or considered as an offer document or solicitation of offer to buy or sell or subscribe for securities or other financial instruments or any other product. Investments in securities market are subject to market risks, read all the related documents carefully before investing. The contents herein mentioned are solely for informational and educational purpose.