Shareholders of cement major India Cements Ltd Tuesday saw their stock value going down by around nine percent to close at Rs.95.35 per share.
The stock opened at Rs.104 down from Rs.104.40 - the closing price Monday. During intra-day trading, India Cements scrip went down by around 12 percent but recovered a bit.
The slide in India Cements stock price seems to be due to Supreme Court raising the issue of conflict of interest - India Cements headed by N.Srinivasan owing the Chennai Super Kings (CSK) team and the Board of Control for Cricket in India (BCCI) also earlier headed by Srinivasan.
Uncertainty hangs over the future of CSK as Srinivasan's son-in-law and the team principal Gurunath Meiyappan has indicted by a probe panel for betting.
As per Indian Premier League (IPL) rules, a team can be debarred if its top officials are found to act in a way that would affect the reputation or standing of the Indian Premier League, the BCCI and the game of cricket.
The apex court had asked Srinivasan to address the conflict of interest issue before seeking the court's sanction to be reinstated as BCCI president.
In September this year, India Cements Board had approved the demerger of CSK (a division) into a wholly owned subsidiary by transferring the assets at net cost.
The effective date of transfer will be Jan 1, 2015, subject to all approvals.
Company officials had earlier said the CSK had given its cement brands good exposure in various markets. The company earned around Rs.166 crore from CSK.
India Cements had successfully bid for the Chennai franchise in 2008 for $91 million. The amount will be paid over a ten year period.
