CESC fell 5.84% to Rs 514.75 at 14:19 IST on BSE after the company said its subsidiary won ownership rights for an Indian Premier League cricket team.
The announcement was made in late trade yesterday, 8 December 2015. The stock fell 1.61% to Rs 546.65 yesterday, 8 December 2015.
Meanwhile, the BSE Sensex was down 203.35 points, or 0.80%, to 25,106.98.
On BSE, so far 63,000 shares were traded in the counter, compared with an average volume of 19,000 shares in the past two weeks.
The stock hit a high of Rs 539.75 and a low of Rs 506 so far during the day. The stock hit a 52-week high of Rs 751.30 on 14 January 2015. The stock hit a 52-week low of Rs 452 on 25 August 2015.
CESC said that New Rising Promoters, a CESC subsidiary, has won the bid floated by The Board of Control for Cricket in India (BCCI) for acquiring the rights and obligations to operate Pune franchise of the Indian Premier League for a period of two years.
According to reports, some brokerages indicated this is a negative development for the Group as there will be operational expenditure to run the IPL team professionally.
Group chief Sanjiv Goenka was quoted by media as saying that CESC will not see any cash outflow to the IPL team. The IPL team will not remain the group's subsidiary for a long time, he said adding that the Group will own the team for a period of two years and will pay Rs 16 crore to BCCI every year. Other expenses will depend on factors like sponsorships as well as the Group will benefit from various branding opportunities, Goenka told the media.
Goenka also said that except Phillips Carbon Black, none of the other subsidiaries will see cash outflow.
Shares of Phillips Carbon Black were down 3.38% at Rs 125.80. The stock fell 3.27% to Rs 130.20 yesterday, 8 December 2015.
CESC and Phillips Carbon Black belong to RP-Sanjiv Goenka Group.
CESC is a Calcutta-based power utility company and Phillips Carbon is the country's largest carbon black manufacturer.
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