Mumbai: Godrej Consumer Products Limited (GCPL) shares fell sharply on Wednesday after the company announced the immediate resignation of Managing Director and Chief Executive Officer Sudhir Sitapati.
The stock dropped 10 percent to hit its lower circuit and a fresh 52-week low of Rs 916.20 during morning trade. The sudden leadership change caused heavy selling by investors.
Heavy Trading
At around 10.30 am, GCPL shares were trading at Rs 929.55 on the BSE, down 8.69 percent.
Nearly 2.9 million shares changed hands on the NSE and BSE in the first three minutes of trading. The high volume showed strong investor concern following the announcement.
The company’s shares have now fallen nearly 30 percent from their 52-week high of Rs 1,308.40.
CEO Resigns
GCPL announced Sitapati’s resignation after the stock market closed on Tuesday. He stepped down as MD and CEO with immediate effect.
The company did not provide detailed reasons for his sudden exit. Sitapati had been leading the FMCG company and was responsible for its growth plans and overall business strategy.
The immediate nature of the resignation appears to have worried investors, leading to a sharp fall in the share price.
New Leader
The board appointed Aasif Malbari as the new Managing Director and Chief Executive Officer with immediate effect.
Malbari is currently GCPL’s Global Chief Financial Officer and President of Godrej Africa. He has around three decades of professional experience in the FMCG and automobile sectors.
He has previously worked with GCPL, Tata Motors and Hindustan Unilever. As Global CFO, Malbari handled business strategy and worked closely with leadership teams across different countries.
Stock Weakness
GCPL shares were already facing pressure before the leadership announcement.
The stock has fallen around 22 percent over the last year and 15 percent in one month. It has declined nearly 23 percent during the past three months.
Over longer periods, the stock has dropped about 9 percent in three years and 6 percent in five years. Investors will now closely watch Malbari’s plans for improving growth and restoring confidence.
