Future Retails slips 5% for 8th straight trading day; stock hits new low

Shares of Future Retail were locked in the 5 per cent lower circuit for the eighth straight trading day, at Rs 19.60, on the BSE in Thursday's trade after the company's Managing Director Rakesh Biyani stepped down while officials, including the company secretary of the debt-ridden firm, tendered resignations.

The stock was trading at record low levels and has slipped 36 per cent in the past two weeks. Till 01:37 PM, a combined 392,000 equity shares had changed hands and there are pending sell orders for 16 million shares on the NSE and BSE, exchange data shows.

The Future Group flagship firm is facing an insolvency petition by its lenders before the National Company Law Tribunal (NCLT).

Rakesh Biyani, who was re-appointed as Managing Director for a period of three years effective May 2, 2019, completed his term as MD on May 1, 2022.

"As he has not sought reappointment, his appointment as Managing Director of the Company ceased to be effective with effect from May 2, 2022. Consequently, he also ceased to be a member of various committees of the Board where he was member," Future Retail said in exchange filing.

Meanwhile, rating agency CARE Ratings has moved ratings of the company’s instruments and facilities to "issuer not cooperating" category.

"Future Retail has not paid the surveillance fees for the rating exercise agreed to in its Rating Agreement. In line with the extant SEBI guidelines, CARE Ratings’ rating on Future Retail’s bank facilities and instruments will now be denoted as CARE D; ISSUER NOT COOPERATING," the rating agency said in rationale.

The ratings take into account delays and defaults in One-time restructuring plan implemented w.e.f. April 26, 2021. The approved plan assumes monetization of certain assets, resulting in de-leveraging of the balance sheet of Future Retail till December 31, 2021, which the company has not been able to monetise in the due time, CARE Ratings said. CLICK HERE FOR FULL REPORT

Earlier, global rating agency Standard and Poor's lowered rating on Future Retails' overseas bonds worth $500 million from CCC- to CC, indicating that they are 'highly vulnerable'.

"The move follows the termination of the deal to sell the ailing company's assets to the Mukesh Ambani-led Reliance group. The issuer credit rating remains 'SD', given the continuing default on the onshore bank borrowings," the agency had said last month.