BSE lowers circuit limit for Kingfisher shares to 5 per cent

Leading bourse Bombay Stock Exchange (BSE) has lowered the circuit limit for Kingfisher Airlines stock, capping its maximum movement in a day at 5 per cent after a recent rally in the equity.

The change will be effective from Friday and follows a sharp rally in the share price of the company in the past few days, where it has surged by more than 35 per cent.

"The circuit filter has been changed from their existing levels in the scrip (of Kingfisher) with effect from September 27, 2013," the bourse said in a circular on Thursday.

In addition, the stock exchange has set a circuit level of 20 per cent for Raymond Ltd and 10 per cent for Indian Hotels Company Ltd.

Earlier, Kingfisher shares were allowed an upward or downward movement of 10 per cent in a day.

The exchanges generally lower the circuit filter of a stock as part of their surveillance mechanism to avoid excessive volatility in the share price.      

Kingfisher has seen an upward movement in its share price in the past few days after its chairman Vijay Mallya said that the carrier is in talks with a foreign investor for potential stake sale.

Shares in Kingfisher, on Thursday, ended 9.91 per cent higher at Rs 6.21 apiece on the BSE.