Ashoka Buildcon SharesTank20%
Mumbai: Shares of Ashoka Buildcon were locked in at 20% lower circuit on Wednesday after the Enforcement Directorate and Income Tax department jointly raided the company’s head office in Maharashtra. It has been alleged that the company has extended financial help to some of the firms of former Maharashtra deputy chief minister Chhagan Bhujbal who was arrested last month in a money laundering case. The stock, which opened at Rs 167, fell 20% after the tax raids. The trading volumes on the counter jumped over four-folds on Wednesday as investors rushed to sell the stock -- 63.24 lakh shares changed hands on BSE and NSE – after the news broke out.
The company has been a favorite of domestic fund managers and high networth investors in the mid-cap construction space. Of the 25 brokerages who track this stock, 23 have given a ‘buy’ rating, while the other two have a ‘hold’ rating on it. Mutual funds held 19% stake in the company as on December 31, 2015. I CICI Direct i n a note o n Wednesday advised investors to exit the stock, saying that though the management has clarified that it has not financed any construction, it still awaits further details from the company, post the ED and IT raids. According to the brokerage, the issue may take a while to get resolved and will continue to be an overhang on the stock.