Shares of Jyoti CNC Automation experienced a significant drop of 15.5% on Monday, reaching an intra-day low of Rs 692 on the Bombay Stock Exchange. The stock later showed a slight recovery but was still trading 13.59% lower at Rs 707.9 during noon trade. The decline followed the disclosure that its French subsidiary, Huron Graffenstaden SAS, is facing an investigation by French authorities for alleged violations of EU export control laws related to “dual-use” machinery.
The investigation, initiated by France’s National Directorate of Intelligence and Customs Investigations, led to the temporary suspension of the director general of the subsidiary and the seizure of bank accounts totaling around €4 million. Additionally, two residential properties owned by Jyoti SAS were placed under interim seizure. A formal judicial investigation has been launched against the subsidiary and some employees, although Huron Graffenstaden SAS has refuted the allegations and is seeking legal counsel to contest the actions taken.
Jyoti CNC clarified that the ongoing operations of the subsidiary are currently unaffected. The company reassured that its standalone business, contributing over 85% of the group’s revenue, is not anticipated to suffer any negative consequences. However, the firm acknowledged the need to evaluate the potential financial implications of the situation, including the assets that have been seized. Established in 1989, Jyoti CNC Automation is a prominent Indian manufacturer specializing in CNC machines, offering a range of advanced solutions incorporating Industry 4.0 and artificial intelligence technologies.
