This Dolly Khanna stock sank 20% in last two sessions. Here's why

New Delhi: Kitchen appliances maker Butterfly Gandhimathi Appliances has dropped more than 20 per cent in the last couple of sessions amid buyout reports circulating in the market.

According to media reports, speculation is rife in the market that Crompton Greaves Consumer Electricals and Havells India are frontrunners in the race to acquire Butterfly.

Following the update, the scrip fell to Rs 1,069.70 on Friday, dropping about 20 per cent from its price of Rs 1,320 on Wednesday. However, it recovered to trade at Rs 1,185 at 11.25 am on Friday.

As per a CNBC TV18 report, a marquee private investor has also expressed interest in buying a stake in the company. However, it did not name the investor.

Seasoned investor Dolly Khanna owns a significant stake in it. According to the shareholding pattern reported by the company, the Chennai based investors held 2,56,792 shares or 1.44 per cent stake as of December 2021 quarter.

The Kitchenware maker reported a 51 per cent decline in the net profit to Rs 9.09 crore for the quarter ended on December 31, 2021 as against a net profit of Rs 18.72 crore in the same period previous year.

The company reported a 13 per cent decline in sales of Rs 258.49 crore in the October-December 2021 period, which was Rs 297.90 crore in the corresponding period a year ago.

Vijay Dhanotiya, Lead Technical Research, CapitalVia Global Research said that Butterfly Gandhimathi has reversed from near the previous breakout levels of Rs 1,070. It is also trading in an ascending channel and is near the lower band.

"We expect the positive momentum in the stock to continue from the lower band of the channel. We recommend to Buy the stock above Rs 1,150 with a Target of Rs 1,450 and a stop loss of Rs 1,060," he added.