Shares of Amtek Auto and its subsidiary Castex Technologies lost 1.97% to 5% at 14:14 IST on BSE on reports the market regulator Securities and Exchange Board of India began a probe into alleged manipulation of Castex Technologies' stock price.
Castex Technologies was locked at 5% lower circuit at Rs 40.35. Shares of Amtek Auto were off 1.97% at Rs 29.85.
Meanwhile, the S&P BSE Sensex was down 258.87 points or 1.01% at 25,460.71.
Market regulator Securities and Exchange Board of India (Sebi) has reportedly begun a probe into alleged share price manipulation at Castex Technologies through forced conversion of foreign bonds. Reports suggested that Sebi is seriously looking into the matter following allegations by some bondholders that efforts are being made to manipulate the share price of Castex Technologies by forcibly asking investors to convert their bonds.
It may be recalled that Castex Technologies had on 31 July 2015 said that its board of directors decided to mandatorily convert all the outstanding bonds of $80.80 million out of foreign currency convertible bond (FCCB) issue of $130 million. The date for conversion of bond into equity shares, would be 10 September 2015, Castex Technologies said at that time.
In a related development, Castex Technologies during market hours today, 10 September 2015 said that it has allotted 3.94 crore equity shares of Rs 2 each at the fixed conversion price of Rs 103.005 per share, thereby effecting the conversion of the outstanding bonds worth $80.8 million out of the $130 million 6% FCCB issue. The company has already converted bonds of $49.2 million pursuant to various conversion notices received voluntarily in the past, Castex Technologies said. Hence, with the present allotment of shares pursuant to conversion of bonds of $80.8 million, the issue of $130 million 6% FCCB has fully been converted into shares of the company which has resulted in the conversion of debt of $130 million into equity, Castex Technologies said.
Castex Technologies reported a net loss of Rs 105.58 crore in Q3 June 2015 compared with net profit of Rs 63.44 crore in Q3 June 2014. Net sales declined 13.9% to Rs 652.60 crore in Q3 June 2015 over Q3 June 2014.
Castex Technologies (formerly known as Amtek India) is a leading provider of iron cast automotive components in India.
Meanwhile, it may be recalled that the shares of Amtek Auto witnessed a massive slide in mid-August 2015, after the National Stock Exchange (NSE) announced that the bourse has decided to exclude the Amtek Auto stock from its equity derivatives segment based on the stock selection/exclusion criteria prescribed by Sebi.
Amtek Auto reported net loss of Rs 157.60 crore in Q3 June 2015 as against net profit of Rs 86.08 crore in Q3 June 2014. Net sales declined 12.7% to Rs 854.22 crore in Q3 June 2015 over Q3 June 2014.
Amtek Auto is one of the largest integrated automotive component manufacturers in India with a strong global presence. Amtek Auto has a presence in forging, grey and ductile iron casting, gravity and high-pressure aluminum die casting and machining and sub-assembly. The company also manufactures components for non-auto sectors such as the railways, specialty vehicles, aerospace, agricultural and heavy earth moving equipment. The company has manufacturing facilities in India, Europe and North America.
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