Shares of CG Power & Industrial Solutions were locked in the lower circuit band of 20 per cent at Rs 14.75 on the BSE on Tuesday after the company recognised "unauthorised transactions" and related financial irregularities in the company.
“While working on one of its priority tasks of seeking refinancing of certain facilities and as a part of conducting financial analysis in this regard, the operations committee (Ops Committee) was made aware of some unauthorised transactions by certain employees of the company,” CG Power said in a regulatory filing while announcing fiscal results for 2018-19.
"The Ops Committee was also made aware of a letter received by the company from a particular financing company with respect to a certain interest payment failure which the Committee was unable to trace or ascertain from the financials. Further, the Managing Director informed the Committee about replacement of a cheque, the validity of which was about to expire, at the behest of a bank... The Ops Committee and the MD could not relate this to any obligations of the company," it added. CLICK HERE FOR FULL REPORT
The stock was trading at its lowest level since August 2004. In the past three months, the share price of CG Power has tanked 62 per cent as compared to a 5 per cent decline in the S&P BSE Sensex.
Till 09:57 am, a combined 922,311 shares changed hands on the counter and there were pending sell orders for 24.4 million shares on the BSE and NSE so far.
CG Power, part of the Avantha group, has two segments namely power systems and industrial systems. The power systems segment manufactures electrical products such as transformers, switchgears and circuit breakers, which find application in power transmission. The industrial systems segment manufactures high and low tension rotating machines (motors and alternators), stampings, as well as railway transportation and signalling products. In March 2016, CG Power had demerged its consumer business, into Crompton Greaves Consumer Electricals Limited (CGCEL).