PC Jeweller tanks 43% in one week on withdrawal of buyback offer

PC Jeweller dipped 13% to Rs 68 on the BSE in intra-day trade, was trading at its lowest level since August 18, 2014.

Shares of PC Jeweller hit nearly four-year low of Rs 68 per share, falling 13% on the BSE in intra-day trade. In past one week, the stock tanked 43% from Rs 122 on July 12, as the company announced the withdrawal of proposed buyback offer due to the non-receipt of the NOC from its bankers. The stock was trading at its lowest level since August 18, 2014.

The stock plunged 89% from its 52-week high level of Rs 457 recorded on January 16, 2018 in intra-day trade. Investors have seen their market cap erosion of Rs 204 billion to Rs 27.73 billion during the period.

“In view of the non-receipt of the requisite NOC from the Company's Bankers, the board of directors at its meeting held today has decided to withdraw the aforesaid Buyback Offer with immediate effect,” PC Jeweller said in a regulatory filing on Saturday, July 14, 2018.

The bankers recommended that for the current year the company should continue to focus on growth and give priority to further reduce its interest expense to the maximum extent possible. Accordingly, they did not approve the proposal of Rs 4,240 million of cash flowing out of the company vide their-letter dated 12th July, 2018 and have not given the required NOC to the Company for its buyback offer, it added.

As of March 2018, foreign portfolio investors (FPIs) hold 31.22% stake in PC Jeweller, while individual share holders held 3.44% stake in the company, the shareholding pattern data shows. The company is yet to file June 2018 shareholding pattern data.

At 02:49 pm; PC Jeweller was trading 10% lower at Rs 70.20 on the BSE, as compared to 0.15% decline in the S&P BSE Sensex.