Force Motors surges 20% but circuit filter prevents further climb
Force Motors hit the roof at Rs 605.15 on BSE after the company said it would sell its shares in a joint venture for 150 mn euros to its German partner MAN Truck and Bus AG.
Shares of Force Motors jumped by 20 percent to hit the upper circuit limit in early trade on the BSE today after the company said it will "almost exit" its JV with MAN Truck & Bus AG by selling 5.58 lakh shares to its German partner for over Rs 1,050 crore.
Reacting to the move, Force Motors saw its shares climb by 20 percent to the highest permissible limit of Rs 605.15 for the day within seconds of the opening bell for the BSE.
The stock had hit a 52-week low of Rs 410.10 on 15 November 2011 and a 52-week high of Rs 975 on 2 December, 2010.
More from Investing[caption id="attachment_137166" align="alignleft" width="380" caption="Force Motors had hit a 52-week low of Rs 410.10 on 15 November."]
[/caption]
The stock had underperformed the market over the past one month until 21 November 2011, sliding 10.81 percent compared with the Sensex's 5% decline. The scrip had also underperformed the market in past one quarter, falling 20.46 percent against 1.21 percent slide in the Sensex.
A circuit filter on the stock does not allow any movement beyond this level in a single day.
In 2006, Pune-based Force Motors and MAN Truck & Bus had formed a joint venture - MAN FORCE Trucks Pvt Ltd (MFTPL) -to produce heavy commercial vehicles.
At the time of formation of the JV, the Indian firm was the majority partner, with an 80 per cent stake. The company became a 50:50 partnership in 2008.
The companies net profit for the second quarter declined 67.7 percent to Rs 4.3 crore on 40.50% rise in net sales to Rs 497.82 crore in Q2 September 2011 over Q2 September 2010.
Agencies
