Management commentary arrests fall in Amtek Auto; stock rallies

NEW DELHI: Amtek Auto Ltd rose as much as 12.5 per cent in trade on Friday, a day after the management finally acknowledged a "temporary cash flow mismatch," in a statement to stock exchanges on Thursday.

Shares of Amtek Auto lost almost a third of its market capitalisation in three trading days of this week.

The component maker said it is exploring various means of fundraising. "There is temporary cash flow mismatch in the company and to mitigate the present situation, the promoters have already infused Rs 75 crore and if required in future will also infuse more funds. The company is also exploring various means of fundraising," the statement said.

The Amtek group companies, a key supplier of auto components have seen their shares punished by investors in recent times.

"The group companies have lost nearly one-third of their market capitalisation (about Rs 4,300 crore) since the start of August," said an ET report. There are four listed companies in the Amtek Group.

Amtek Auto is the parent company, which holds stakes in Castex (formerly Amtek India), Metalyst Forgings (formerly Ahmednagar Forgings) and JMT Auto.

As per the report, the group debt stood at Rs 15,073 crore and interest payment has surged by 43% on a sequential basis to Rs 534 crore from Rs 371 crore for Amtek Auto, Castex Tech and Metalyst Forgings in June 2015.

The stock of Amtek Auto was also excluded from the derivative segment from September, this year. This led to investors unwinding its positions, say experts.