Shares of Balaji Amines Ltd., are looking to recover from opening lows after the exit of the company's CFO and five other independent directors.

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In a conversation with CNBC-TV18, one of the independent directors, Satyanarayana Murthy Chavali said that all independent directors have only stepped down due to SEBI regulations, which mandate an independent director to resign if he or she has completed 10 years at that position.

In a filing to the exchanges, five independent directors of Balaji Amines - Naveena Thammishetty Chandra, Kashinath Revappa Dhole, Satyanarayana Murthy Chavali, Amarender Reddy Minupuri and Vimala Behram Madon resigned citing personal reasons.

Chavali said that SEBI does not allow for more than two five-year terms for independent directors and they would not be considered independent if they end up having a tenure of more than 10 years. He added that the current CFO, Hemanth Reddy Gaddam, will move to a subsidiary company Balaji Specialty Chemicals, while Srinivas Reddy will take over as the new CFO.

The outgoing independent director further added that he would be happy to be reappointed after a three-year period and that no further resignations are expected within the company. "Fundamentally there are no issues with the business and the growth trajectory is intact," he said.

For the March quarter, Balaji Amines had reported a 40 percent year-on-year drop in both revenue and operating profit. The company's bottomline fell nearly 60 percent from last year, while margin contracted by 20 basis points.

The management said that the fall in margin was due to the weakness in Pharma API and the Agro sector and that they will return to pre-Covid levels of growth "in due course."

Shares of Balaji Amines, which had dropped as much as 18 percent in opening trade following the news, are currently trading 9.7 percent lower at Rs 2,082.45. The stock's intraday low of Rs 1,880, also happens to be a new 52-week low for the stock.

(Edited by : Hormaz Fatakia)

First Published:May 22, 2023 10:20 AM IST