Shares of India's largest two-wheeler maker Bajaj Auto fell for a second day, reacting negatively to the demerger of the non-auto business from the group's flagship company, whose new structure analysts termed as "convoluted".
The scrip plunged over 15 per cent soon after trading began this morning and closed 8.54 per cent down at Rs 2,286.80. It had fallen by seven per cent at Rs 2500.30 on Thursday.
Making things even worse, a number of brokerage houses downgraded their investment rating and target price for the stock, saying that the scrip could take a further hit if investors decide to sell-off in large numbers.
The stock fell by nearly 15 per cent to Rs 2,179 in intra-day trading on the Bombay Stock Exchange and 17 per cent on the National Stock Exchange as the scrip witnessed across the board selling.
As per the proposal, Bajaj group's auto business will be demerged into a new subsidiary Bajaj Holdings and Investment Ltd (BHIL) and other strategic businesses such as wind energy, insurance and financial services would be hived off into another new entity Bajaj Finserv Ltd (BFL).
Read more in DNA Money article.
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