Shares of Bajaj Auto ended 1.56 per cent lower at Rs 428.15, even as the crisis within the Bajaj family continued. Up to 1.52 lakh shares of the company changed hands on Bombay Stock Exchange today.
On the National Stock Exchange, the stock hit an intraday low of Rs 427.30, before settling 1.56 per cent higher at Rs 428.15.
"The feud within the Bajaj family continues to dog the stock," dealers at an institutional brokerage house said.
Stocks of Bajaj Auto declined sharply over the last few weeks, after the rift within the Bajaj family was brought to light.
From a 52-week high of Rs 548.10 on July 4, 2002, the scrip lost 23.7 per cent to settle at Rs 417.85 on August 2.
"Drought like conditions in many parts of the country have also affected sentiment in Bajaj Auto, as a large chunk of the two-wheeler company's revenues comes from the rural sector," another dealer explained.
However, bargain hunting and a revival in the monsoons in north India helped the scrip recover. From Rs 417.85 on August 2, 2002, the scrip rose 8.3 per cent to settle at Rs 452.65 on August 12, 2002. The scrip has come off once again.
Shishir Bajaj, who holds a close to six per cent stake in Bajaj Auto, wants to separate from the Bajaj group.
Shishir wants to offload his stake in some group companies in return for full control over the sugar manufacturing entity Bajaj Hindustan (which is already being managed by him), as per reports.
However, differences are reported to have cropped up over the valuation of Shishir's six per cent holding in Bajaj Auto.
Fears are that if Shishir Bajaj sells his stake in the open market, the scrip's price will be drastically affected as a result of the demand-supply mismatch.
Meanwhile, despite monsoon worries, Bajaj Auto has maintained its sales target of 15.48 lakh vehicles for the year ended March 2003.
However, Bajaj Auto's motorcycle sales growth ebbed in July 2002. Bike sales rose 20 per cent in July 2002 to 61,485 units. The company attributed the lower growth in July 2002 to the power grid failure (in July) in five states, including Maharashtra.
It said the introduction of ERP systems by many of its dealers had also hampered July sales.
