Shares of Polycab India Ltd traded higher in Friday's early trade following a sharp 21.08 per cent drop yesterday. The stock was up 4.74 per cent to hit a day high of Rs 4,061.35 over its previous close of Rs 3,877.40.
The company, in a clarification to exchanges, said it has not received any written communication from the income tax (I-T) department regarding the outcome of December raids.
In a statement date January 10, the Ministry of Finance (without naming any company) mentioned the I-T department had credible evidences that a company engaged in "cables and wires" made unaccounted cash sales of around Rs 1,000 crore.
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"The company understands that there is a press release titled 'Income Tax Department conducts search operations in Mumbai' published on January 10, 2024 by Press Information Bureau, Delhi, which does not specifically name any company. The company reiterates that as on date, the company has not received any written communication from the I-T department regarding the outcome of the search. As indicated above, the company has made intimation from time to time in relation to the said search proceeding," Polycab India stated.
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"The ongoing tax evasion case awaits further clarity. Amidst expectations of sustained volatility, there is an anticipation that the stock will underperform," said Anil R, Research analyst, Geojit Financial Services.
On technical setup, the counter was trading lower than the 5-day, 10-, 20-, 30-, 50-, 100-, 150- and 200-day simple moving averages (SMAs). The counter's 14-day relative strength index (RSI) came at 21.02. A level below 30 is defined as oversold while a value above 70 is considered overbought.
The company's stock has a price-to-equity (P/E) ratio of 35.39 against a price-to-book (P/B) value of 8.09.
The company is the country's largest manufacturer of wires and cables. Polycab's business operations span across India through 23 manufacturing facilities, 15-plus offices and 25-plus warehouses.
(Disclaimer: Business Today provides stock market news for informational purposes only and that should not be construed as investment advice. Readers are encouraged to consult a qualified financial advisor before making any investment decisions.)
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