Future Retail slumps 5%; down 40% in September

NEW DELHI: Shares of Future Retail continued their downward journey on Wednesday, falling another 5 per cent. The scrip has been on a free fall for over a week now and closed in the red in every session in September.

The stock was locked at the lower circuit, down 4.97 per cent at Rs 96.50.

Future Retail had jumped 20 per cent following the announcement of deal with Reliance Industries but incessant profit booking in stock after that means it is now down 40.54 per cent since then.

Other Future Group stocks have also suffered similar losses. By the end of closing on Tuesday, Future Enterprises, Future Enterprises-B DVR and Future Lifestyle Fashions had plunged 24-27 per cent in September. Other group stocks have also fallen 16-19 per cent.

Market analysts believe the selling pressure on Future Group stock will continue.

“The shares of Future Group are now pegged to Future Enterprise with the scheme of amalgamation being announced. The performance of the group will be subdued until there is clarity on the remaining businesses including insurance and real estate which the company intends to liquidate for further debt reduction,” said Divam Sharma, co-founder at Green Portfolio, a Sebi registered PMS firm.

He advised investors to avoid investing in the group stocks for now.

Probal Sen, an analyst with Centrum Broking said he doesn’t track Future Group stocks closely but said the recent pressure on the stocks could be because a number of things need to be worked out, including how stocks will be allotted to minority shareholders.