Hit hard by a Sebi order, shares of the country's largest realty developer DLF on Tuesday plunged by nearly 30 per cent to hit a life-time low, wiping out nearly Rs 7,500 crore (Rs 75 billion) or over one-fourth of its market value.
The carnage in DLF shares began soon after the markets opened this morning in the first trading session after Sebi's order, wherein the company and six top executives have been barred from accessing securities markets for three years for disclosure lapses seven years ago at the time of its IPO.
The stock hit a life-time high of Rs 102.70 with a plunge of 29.99 per cent, before ending the day slightly higher at Rs 104.95 a piece at the BSE.
At the NSE, the stock plunged 27.98 per cent to settle at Rs 105.80. DLF was the worst performer among all BSE stocks.
The huge sell-off in DLF shares, presumably by retail as well as foreign and domestic institutional investors, led to a loss of Rs 7,438.67 crore (Rs 74.38 billion) in the company's market valuation, which stood at Rs 18,701.33 crore (Rs 187.01 billion) at the end of trade today. Nearly 9 crore (90 million) shares changed hands at the BSE and NSE during the day. The stock had fallen by nearly 4 per cent yesterday too.
Besides chairman and main promoter K P Singh, those barred from the markets include his son Rajiv Singh (Vice Chairman), daughter Pia Singh (Whole Time Director), Managing Director T C Goyal, former CFO Ramesh Sanka and former ED (Legal) Kameshwar Swarup.
DLF said it has not violated any laws and it would defend its position
While the regulator has not imposed any monetary penalty, the prohibition order would bar DLF and the six persons, from any sale, purchase or any other dealings in securities markets for a period of three years, including for raising funds.
DLF had over Rs 19,000 crore of debt as on June 30, 2014, while its already-proposed fund raising plans include nearly Rs 3,500 crore through issue of certain bonds to lower debts.
This is one of the rare orders by Sebi where it has barred a blue-chip firm and its top promoter/executives.
The order can be challenged at Securities Appellate Tribunal.
DLF is the largest real estate group in the country with nearly Rs 10,000-crore (Rs 100-billion) annual turnover and market value of over Rs 26,000 crore (Rs 260 billion).
Its market cap had crossed Rs 100,000 crore mark soon after its listing in 2007, but fell later.
DLF's IPO in 2007 had fetched Rs 9,187 crore (Rs 91.87 billion) -- the biggest IPO in the country at that time.
"Markets lost all their early gains instantly in reaction to Sebi's decision to ban DLF top management to access capital markets over the next 3 years. DLF, which is an index stock, corrected by over 27 per cent," said Rakesh Goyal, Senior Vice President, Bonanza Portfolio.
Selling was also seen in other realty stocks, with HDIL falling 5.11 per cent, Unitech (2.43 per cent), D B Realty (2 per cent) and Anant Raj (1.23 per cent).
Led by the losses in these scrips, the BSE Realty index ended 9.24 per cent lower at 1,419.23, emerging as the biggest loser among the sectoral indices.