BSE Resets Circuit Limit Of CG Power, Five Other
To curb excessive volatility, BSE on Monday revised the circuit limit for the share movement of CG Power and Industrial Solutions Ltd. and five other companies.
In a notice, the exchange said it has set a circuit limit of 5 percent for CG Power.
The new limits, effective from Tuesday will ensure stock prices do not go up or down beyond a level during a session.
CG Power has been witnessing volatility in its share prices after the firm on Aug. 20 stated that an investigation instituted by its board had found major governance and financial lapses including some assets being provided as collateral and the money from the loans siphoned off by "identified company personnel, both current and past, including certain non-executive directors."
Since then, the stock has seen a spurt in trading activity and hit lower circuit limits in each trading session on BSE.
The scrip on Monday hit the lower circuit of Rs 8.65, a new 52-week low on BSE.
Apart from CG Power, a limit of 5 percent has been set for GFL Ltd, Acewin Agriteck Ltd, Opto Circuits (India) Ltd and Unitech Ltd while a limit of 10 percent has been set for Gallant Ispat Ltd.
Circuit filter mechanism is used by stock exchanges to keep excessive volatility for a scrip in check. It is the maximum fluctuation that is allowed in a stock, after which trading in it gets suspended if the permissible limit is hit in either direction.