Shares of CE Info Systems Ltd., parent company of MapMyIndia, fell another 8% on Tuesday, December 3, extending its losses from Monday’s 4% fall.
The stock declined after the company announced that its CEO Rohan Verma will be stepping down from his position to pursue an independent venture, where MapMyIndia will hold a 10% stake.
In an interaction with CNBC-TV18 on Tuesday, December 3, the management of CE Info Systems said that the consumer business will be run by Rohan Verma’s personal funds and that MapMyIndia will have an option to invest ₹35 crore in the company through Compulsory Convertible Debentures (CCDs). The 10% stake for MapMyIndia will be worth ₹10 lakh.
The management further said that the B2C business will have an annual cash burn rate of ₹30 crore, which will continue to increase. No money from MapMyIndia will be invested in the new entity, they added.
Out of the six analysts that have coverage on CE Info Systems, four of them have a “buy” rating, while the other two have a “sell” rating.
Shares of CE Info Systems are trading 8.5% lower, further extending losses after the management clarification at ₹1,545.3. The stock is now down 44% from its recent peak of ₹2,747.
With Tuesday’s fall, the stock is now down below its listing price of ₹1,581, but is above its IPO price of ₹1,033.
Content retrieved from: https://www.cnbctv18.com/market/ce-info-systems-mapmyindia-share-price-below-listing-levels-new-entity-cash-burn-subscription-returns-19518554.htm.
