Seven out of the 12 companies identified by the Reserve Bank of India’s Independent Advisory Committee (IAC) to be referred to bankruptcy courts were trading lower on Monday, as the names started coming out over the weekend. Three of them – Essar Steel Ltd., Bhushan Power Ltd. and Era Infra Ltd. – are not listed entities. Jyoti Structures Ltd. and ABG Shipyard Ltd. are the two other listed companies which are also on the list and are currently trading in the green. The nine companies have a collective market capitalisation of close to $1 billion.
Most of these stocks had run up over the past one year amidst talks of asset sales or a possible debt restructuring. Bhushan Steel and Electrosteel Steels Ltd. rose more than 45 percent year-to date.
Most of these stocks are now trading with losses over a 5-day period. In fact, shares of Amtek Auto Ltd. and Lanco Infrastructure Ltd. have seen cuts of over 30 percent in the last five trading sessions.