Ashoka Build­con SharesTank20%

The Economic Times - - Companies -

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.

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