Mumbai: Hundreds of the companies, mostly from mid-cap and small-cap segments, on Friday, saw their share prices hitting the all-time lows or lowest permissible limit for the day amid concerns over loans raised by their promoters with shares or convertible bonds as collaterals.
As a fall in the rupee value to below Rs 51-level versus the US dollar made the foreign borrowings costlier, the share prices were battered of the companies having heavy promoter pledges and significant exposure to loans through foreign currency convertible bonds, marketmen said.
As per the stock exchange data, share prices of as many as 137 companies hit their all-time low levels on Friday, while a total of 343 stocks hit their lower circuit or fell to the maximum permissible limit for the day on the BSE.
The companies whose shares hit all-time lows on Friday included state-run telecom major MTNL (down 4.54 per cent to Rs 25.20), as also private sector players like Punj Lloyd (down 5.96 per cent to Rs 45.75) and GMR Infrastructure (down 3.87 per cent to Rs 19.85). It was mostly mid-cap and small-cap stocks, which were seen bearing the maximum brunt. The stocks having hit record lows included NDTV, Bartronics, Network18 Media, Indiabulls Real Estate, Indiabulls Power and MOIL among others.
Commenting on the trend, Unicon Financial Solutions CEO Gajendra Nagpal said "Markets are in a bear grip. Sentiments are very low. Barring a few stocks, a considerable number of stocks are ruling at a price which is lower than the price which used to be there in 2008."
The companies whose shares hit the lower circuit limits included Parsvnath Developers, Pipavav Defence, MVL, SKS Microfinance, Edserv and Kwality Dairy among others.
Many of these companies have either significant exposure to foreign currency convertible bonds, or their promoters have heavy pledged their shares.
Some newly listed entities, such as Taksheel, Sujana Towers, MB Switch and Birla Pacific Medspa also hit the lower circuits amid a heavy battering of their stocks. "Domestic scenario is in a very bad shape, second quarter corporate earnings were muted, and there is lack of policy initiatives by the government," Nagpal said, while adding that FIIs were also not infusing funds because of the extreme rupee volatility.
The benchmark index, the Sensex, also closed in the red with a decline of over 90 points, marking its seventh straight session of a losing streak. However, it managed to recover from the intra-day lows, when it had lost over 200 points. The Sensex has lost about 1,200 points in the last seven sessions.
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