Shares of Navin Fluorine International Ltd dropped over 4% in trade on Thursday after the company issued an update on the resignation of its managing director (MD) Radhesh Welling.

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The company said that the search was currently underway for a suitable replacement for the role.

During a conference call, Navin Fluorine said that it expected to execute current and upcoming projects seamlessly and no ongoing projects should get delayed during this transition.

The management also clarified that it was working with the human resources to address the attrition issue at the senior level. Customer relationships should not be impacted, too, it added.

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However, investors were not convinced as the Navin Fluorine stock dropped as much as 4.4% on Thursday to trade at a new 52-week low of ₹3,654.50 per share on BSE.

The stock has dropped over 16 percent in the past five trading sessions after Welling stepped down from his position as managing director last week, citing personal reasons, with effect from December 15.

This is the second high-profile exit seen by the company in the last two months. On August 18, Ravi Venkataramanan had stepped down from his role as a CEO.

The exits come at a time when the company wants to raise equity in order to achieve capital discipline.

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Global equity research firm Jefferies took notes of the recent developments and has downgraded the Navin Fluorine stock to ‘hold’, while lowering the price target to ₹3,625 from ₹5,475 earlier.

It said in a note that the current circumstances make it difficult for Navin Fluorine to raise equity.

Jefferies has also cut the company’s EBITDA estimates for FY24/25 by 13% on slower capital expenditure. EBITDA refers to earnings before interest, tax, depreciation and amortisation.

Shares of Navin Fluorine International were trading 3.56% lower at ₹3,687.45 apiece on BSE at 10:09 AM.

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(Edited by : Asmita Pant)

First Published:Oct 5, 2023 11:22 AM IST