Shares of MTAR Technologies Ltd. experienced a significant downturn, extending their decline for the fourth consecutive trading session. The stock plummeted nearly 19% over these four sessions and has seen a correction of 34.30% in the past month, hitting a low of Rs 5,454.45 on Tuesday.
Why MTAR Technologies Shares Are Under Pressure
The recent sell-off in MTAR Technologies shares is primarily linked to adverse developments concerning its crucial manufacturing partner, US-based Bloom Energy Corp. Bloom Energy's shares dropped 8.33% overnight, extending their one-month decline to 43.02%. This has a substantial impact on MTAR, as Bloom Energy contributes over half of its revenue.
The weakness in Bloom Energy's stock stems from reports of regulatory hurdles delaying a major Oracle-linked data centre project. This project was expected to extensively deploy Bloom Energy's fuel-cell technology, and the delays have dampened investor sentiment.
Additional Surveillance Measure (ASM) Framework
Further contributing to the investor caution, both the BSE and NSE have placed MTAR Technologies under the long-term Additional Surveillance Measure (ASM) framework. Stock exchanges utilize the ASM framework to alert investors to heightened volatility in share prices and to bolster market surveillance, indicating increased scrutiny on the stock's trading activity.
Company Reassurance Amidst Volatility
Despite the current volatility, MTAR Technologies remains a multibagger for 2026, with its stock still up 127.92% on a calendar-year basis. Last month, the company sought to reassure investors regarding the Bloom Energy situation. MTAR stated that its order book remains robust and that no customer communication has indicated a reduction in committed business. The company also confirmed that its capacity expansion plans are on track and that it continues to work closely with customers to meet delivery schedules.
Furthermore, MTAR Technologies clarified that there are no regulatory or legal proceedings that require disclosure and could influence the movement in the price or volume of its securities, aiming to mitigate investor concerns about potential undisclosed issues.