MUMBAI (Reuters) - Shares in India’s Suzlon Energy (SUZL.NS) plunged as much as 45 percent to a record low on Thursday as investors worried about the wind turbine maker’s debts pared their holdings after a partial stake sale by its founders.
The disposal of a 6.2 percent stake to raise 2.4 billion rupees was part of a debt restructuring process, Suzlon chief financial officer Kirti Vagadia told Reuters.
“The promoter stake sale is not for any personal purpose but ... for supporting the company. The promoters are fully committed to the company,” he said.
“The business fundamental of the company is intact. We are getting very good orders.”
Suzlon shares tumbled as much as 44.9 percent to 13.35 rupees before closing down 34 percent against a broader market fall of 1.8 percent.
“The overall market was weak today and the news about the promoters stake sale added fuel to the fire,” said Jagannadham Thunuguntla, equity head at SMC Global Securities.
“Investors remain worried about the company’s debt profile.”
Suzlon’s lenders last month approved a plan to restructure $1.8 billion of debt after the company defaulted on a $200 million convertible bond redemption last October.
The company had net debt of about $2.5 billion at the end of December.
Vagadia said the founders group - which includes Suzlon Chairman Tulsi Tanti and other associated individuals and firms - would put fresh money into the company.
“By selling certain shares we can get funds for the company,” Vagadia said, adding he did not expect the founders to sell more stock in the near future.
After the sale, the founders’ stake has fallen to 44.5 percent, according to stock exchange filings.
Suzlon, squeezed by debt payments, tight working capital and falling global demand for turbines, has lost money for the past three years.
It has been looking to sell non-core assets to cut borrowings and the “debt management side” was progressing well, Vagadia said, without giving details. (Reporting by Sumeet Chatterjee and Indulal PM; Editing by David Cowell)