Synopsis:
Hindustan Motors Limited, slipped into a five percent lower circuit after the company announced its voluntary delisting plans from NSE.
An auto stock tumbled sharply after the announcement of its delisting and suspension from trading on the National Stock Exchange. The counter hit a five percent lower circuit, reflecting concerns among investors about the company’s limited business prospects and exit from the exchange.
Hindustan Motors Limited, with a market capitalization of Rs. 475.95 crore, opened at Rs. 23.90 against its previous close of Rs. 24.01 and slipped to an intraday low of Rs. 22.81. The stock locked in its lower circuit of five percent after the announcement.
What’s the News?
Hindustan Motors Limited has applied for voluntary delisting under Regulation 5 and 6 of the SEBI (Delisting of Equity Shares) Regulations, 2021. Following this, the company’s shares will be suspended from trading with effect from October 3, 2025. The admission to dealings in its securities will be permanently withdrawn (delisted) from the National Stock Exchange with effect from October 10, 2025.
Possible Reasons for Delisting
The company has witnessed very low trading volumes for years, which made it difficult for investors to enter or exit meaningfully. Furthermore, Hindustan Motors had exited car manufacturing long ago, leaving minimal core auto operations. This significantly reduced the relevance of remaining a listed entity.
Additionally, being publicly listed requires continuous disclosures, compliance costs, and regulatory filings, which can be burdensome for a dormant or struggling business. Promoters may also prefer to repurpose or restructure the company in a private setting, without the obligations tied to being listed.
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Financial Snapshot
Hindustan Motors has reported nil sales for the last two quarters. However, other income rose sharply from Rs. 1.06 crore in March 2025 to Rs. 5.11 crore in June 2025, largely due to a write-back of Rs. 3.61 crore related to settlement of Uttarpara Municipal Tax liabilities.
The company has been rationalising costs since the suspension of work at its Uttarpara plant, with significant reductions in fixed costs and employee liabilities. Accumulated losses dropped to Rs. 107.52 crore as of March 31, 2025, compared to Rs. 252.18 crore in March 2017.
The company is currently debt-free, barring minor liabilities relating to employees, trade payables, and other obligations. With current assets exceeding current liabilities, Hindustan Motors maintains adequate liquidity to meet its obligations.
About the Company
Incorporated in 1942, Hindustan Motors Limited is one of India’s oldest automobile manufacturers and was part of the CK Birla Group. It gained iconic status with its Ambassador car, which once dominated Indian roads.
The company also partnered with global players like Mitsubishi for vehicle production. However, faced with declining demand and growing competition, Hindustan Motors ceased production of the Ambassador in 2014. Today, the company has minimal automotive operations and primarily focuses on managing existing assets and pursuing restructuring opportunities.
Written By Manan Gangwar
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