Mumbai, April 13 (IANS) Shares of Jyoti CNC Automation fell sharply on Monday, dropping 15.5 per cent during the day to hit an intra-day low of Rs 692 on the Bombay Stock Exchange (BSE).

The stock later recovered slightly and was trading 13.59 per cent lower at Rs 707.9 during noon trade.

The decline in the company’s shares came after it disclosed that its French subsidiary, Huron Graffenstaden SAS, is under investigation by French authorities.

The probe relates to alleged violations of European Union export control laws concerning “dual-use” machinery, which can be used for both civilian and military purposes.

“Over this week, certain relevant authorities for our material subsidiary Huron Graffenstaden SAS had initiated investigation against Huron Graffenstaden SAS and certain of its employees where such employees had been interviewed by French authorities regarding export controls and export-documentation of machinery considered to be of dual-use,” it said in its filing.

The investigation has been initiated by France’s National Directorate of Intelligence and Customs Investigations.

As part of the interim measures, the director general of the subsidiary has been temporarily barred from performing duties.

Authorities have also seized bank accounts worth around €4 million and placed two residential properties owned by Jyoti SAS under interim seizure.

A formal judicial investigation has been launched against the subsidiary and some of its employees.

Huron Graffenstaden SAS has denied the allegations and said it is seeking legal advice to challenge the action.

The company is also trying to get more clarity from the authorities regarding the matter.

In a regulatory filing, Jyoti CNC said that the current operations of the subsidiary remain unaffected for now.

It also stated that the developments are not expected to have any adverse impact on its standalone business, which contributes more than 85 per cent of the group’s revenue.

However, the Rajkot-based firm added that it is still assessing the potential financial impact of the developments, apart from the assets that have already been seized.

Founded in 1989, Jyoti CNC Automation is one of India’s leading manufacturers of CNC machines.

Its product range includes turning centres, machining centres, five-axis machines, and advanced solutions powered by Industry 4.0 and artificial intelligence.

–IANS

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