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Shares of Hindustan Construction Co Ltd witnessed worst day since 2008 due to doubts over the ability of its unit to continue as a going concern.
HCC plunged nearly 24 per cent to Rs 17.85, its biggest intraday percentage loss since October 24, 2008. The stock hits lowest level since March 1, 2016.
Auditor of the company’s unit Lavasa Corp had said on Wednesday it has “significant doubts about the company’s ability to continue as a going concern”.
The auditor also said as on March 31, net worth of Lavasa, its subsidiaries, joint ventures and associates has been “significantly eroded”; most of the entities have incurred losses or do not have any operations during the year ended March.
Lavasa, which is developing a private hill city project in Maharashtra, has posted a net loss of Rs 682 crore for the year ended March 31, 2018 against loss of Rs 166 crore a year earlier.
Lavasa said it was in the process of preparing resolution plan along with lenders. Lavasa's capital work-in-progress as on March 31 includes an amount aggregating Rs 1,197 crore, while total equity and liabilities as at March 31 amounted to Rs 6,377 crore.
Up to Wednesday's close, the stock had lost nearly half its value in 12 months.
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