Amtek Auto, subsidiaries hit upper circuit; here’s why

Amtek Auto and its subsidiaries touched the upper circuit on Tuesday after ET reported that Deccan Value, a US registered hedge fund, has emerged as the highest bidder for the beleaguered the auto component maker facing bankruptcy proceedings for defaults of over Rs 12,700 crore.

If lenders accept this offer, they are likely to face a haircut of around 65 per cent. Haircut is the amount of loan that lenders are willing to forgo to settle a loan.

Amtek Auto had received two binding bids –– from Liberty House and Deccan Value –– in the initial round.


The scrip climbed 4.60 per cent to settle at Rs 25.

Amtek Auto is a key supplier to leading auto manufacturers such as Maruti Suzuki and Tata Motors.

Its two other subsidiaries –– Castex Technologies and Metalyst Forgings –– are also going through bankruptcy proceedings. All the three companies have an overdue of Rs 22,000 crore. Castex Technologies and Metalyst Forgings also hit upper circuit on Tuesday.

Metalyst Forgings settled 0.68 per cent up at Rs 29.60 but Castex Technologies erased the gains and declined 0.20 per cent to close at Rs 5.05.

Metalyst Forgings, formerly Ahmednagar Forgings, is an India-based forging axle beam and crankshaft manufacturing company. Castex Technologies, formerly Amtek India, is an iron casting firm.