Videocon hits lower circuit, falls 67% in 12 sessions

S hares of Videocon Industries hit its lower circuit limit of 5% for the 12^th straight session, falling 67% in 12 days to Rs 33.25 as investors continued selling the stock after two lenders declared its account as non-performing assets (NPA). 
 
On the BSE, 26,000 shares were traded in the counter so far, compared with average daily volumes of 35,863 shares in the past one quarter. The stock opened with a downward gap of 5% at Rs 33.25 and remained stuck at that level so far, which is also its 52-week low level.
 
The recent sell-off in the stock has been triggered by escalating debt woes of the company. Central Bank of India, which has one of the highest exposures to Videocon at Rs 2700 crore declared the company as a non-performing asset (NPA).

 

Dena Bank had also announced that it had classified Videocon’s loan amounting of Rs 520 crore as non-performing assets (NPA) while Punjab National Bank, too, has reportedly declared its loan to the company as NPA.
 
The sharp fall in market price of the stock have seen investors wealth in Videocon Industries declined by Rs 400 crore during the week. At the current market price, Videocon’s market capitalisation stands at Rs 1,112 crore against Rs 1,582 crore on May 26, 2017.
 
The company has Rs 40,000 crore debt on its balance sheet. Recent reports suggested that the company was asking a consortium of 17 banks for an extension of its loan-repayment period by five years. During the period, the company intends to sell its assets to slash debt.