Shares of Mishtann Foods Ltd (MFL) extended their steep fall for the second straight session in Monday's trade. The stock nosedived 20 per cent to hit its lower circuit limit of Rs 9.94. At this price, the penny scrip has plummeted 35.95 per cent in just two trading sessions. On a year-to-date (YTD) basis, it has corrected 39.72 per cent. (A penny stock usually refers to a share that trades below Rs 10 per share.)
The counter dwindled after Mishtann Foods received a show cause notice from Sebi. The notice was issued over the company's Rs 100 crore fund which the market regulator highlighted was misappropriated or diverted through group entities.
The Securities and Exchange Board of India accused Mishtann of inflating sales and purchases through fictitious transactions with entities allegedly created under the names of the promoters and their relatives.
It has barred five entities, including the company, its promoter and CMD Hiteshkumar Gaurishankar Patel from the securities markets till further orders for alleged financial mismanagement, fraudulent transactions and corporate governance lapses.
Mishtann Foods, in response, said, Sebi's notice "is NOT a final order and is inter alia asking for an explanation from the company. MFL doesn't agree with the contents and the prima facie observations of the said Interim order. The management of MFL totally denies all the purported allegations mentioned in the Interim Order cum Show Cause Notice."
The Legal & Compliance team at MFL is making efforts to address the queries and take appropriate actions in accordance with the rights vested in law, it added.
On the stock-specific front, around 51.49 shares were last seen changing hands on BSE today. The figure was lower than the two-week average volume of Rs 54.90 lakh shares. Turnover on the counter came at Rs 5.11 crore, commanding a market capitalisation (m-cap) of Rs 1,071.15 crore. There were 5,37,77,214 sell orders today against buy orders of nil shares.
Technically, the scrip traded lower than the 5-day, 10-, 20-, 30-, 50-, 100-, 150-day and 200-day simple moving averages (SMAs). The stock's 14-day relative strength index (RSI) came at 23.99. A level below 30 is defined as oversold while a value above 70 is considered overbought.
As per BSE, the company's stock has a price-to-equity (P/E) ratio of 135.81 against a price-to-book (P/B) value of 4.67. Earnings per share (EPS) stood at 0.09 with a return on equity (RoE) of 3.44. Promoters held a 43.48 per cent stake in the company as of September 2024.