The stock price of Heubach Colorants India plunged over 15 percent on BSE on April 23 after its sister company Heubach GmbH, considered as the second largest pigments player globally, filed for bankruptcy in Germany on April 22. Both the firms are part of the Heubach group.
“Heubach GmbH filed an application today for the opening of regular insolvency proceedings over its assets with the competent insolvency court in Braunschweig and, at the same time, applied for the jurisdiction of the Braunschweig insolvency court as the group court for the German subgroup of the Heubach Group,” Heubach Colorants India said in a stock exchange filing.
The court is expected to appoint an insolvency administrator to examine the possibility of continuing business operations and possible options for restructuring and/or selling the business in due course, the statement added.
Heubach Colorants India was trading at Rs 394, declining 15.1 percent on BSE as of 12:10 pm on April 23.
The development is likely to benefit Sudarshan Chemicals, which is the third largest pigments player in the world and one of the biggest competitors of Heubach Colorants India, according to a note by Centrum Broking. The shares of Sudarshan Chemical have registered a jump of 9.67 percent to Rs 689.85 in early trading on the BSE on April 23. Till the time Heubach firm deals with insolvency, the Indian company can increase its market share and boost its exports share, according to the note. Sudarshan Chemicals has already strengthened its product portfolio with new launches.
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