Surana Solar Drops After Rakesh Jhunjhunwala Denies Buying Stake

Mumbai: Shares in Surana Solar Ltd dropped 13.6 per cent on Wednesday, more than reversing steep early gains, after widely-followed investor Rakesh Jhunjhunwala denied exchange data showing he had bought the stock.

Earlier, the shares rose as much as 17.4 per cent after data from the National Stock Exchange (NSE) showed Mr Jhunjhunwala had bought 256,500 shares, or 0.5 per cent of the outstanding shares, in Surana Solar on Tuesday.

However, Mr Jhunjhunwala denied being the buyer, sending the shares sharply lower.

"I don't own even a single share," he told Reuters.

The NSE and the financial regulator were not immediately available to comment.

Mr Jhunjhunwala has a large following among small investors in India and news of his purchases, or sales, can impact the fortune of shares.

Narendra Surana, chairman of Surana Solar which has a market capitalisation of Rs 262 crore ($41.04 million), said he had spent the day dealing with queries about the volatility of the stock.

"It is unfortunately a needless distraction for me. Now I'll be spending time answering to the regulator and stock exchange on what happened," he told Reuters, without elaborating.

India is no stranger to sharp share price moves, and market rumours often drive stock prices up only to be disproved later.

By the end of the trading day, 5.8 million Surana Solar shares had changed hands, compared with a daily average of just over 141,000 shares last week.

($1 = 63.8350 rupees)