Cairn India CEO Quits After Oil Explorer’s Record Quarterly Lossby
CEO exit negative for stock in near term, SBI Capital says
Cairn-Vedanta merger announced in June yet to be completed
Cairn India Ltd. said its Chief Executive Officer Mayank Ashar resigned citing personal reasons, just a month after the nation’s largest private oil producer posted its biggest quarterly loss.
Ashar will step down on June 5 and will be replaced by Chief Financial Officer Sudhir Mathur as interim head of the company, Cairn India said in a stock exchange filing on Friday. Ashar, who took charge in October 2014, oversaw the company amid the worst ever slide in oil prices and an ongoing process of merger with parent Vedanta Ltd. In January, Cairn India said the merger will take at least six more months.
“This is definitely unsettling,” said Amit Agarwal, analyst at SBI Capital Markets Ltd. “He has given personal reasons but there is no clarity beyond that.”
Ashar did not respond to an e-mail seeking comment.
Cairn last month reported a group net loss of 109.5 billion rupees ($1.6 billion) in the three months ended March, that was wider than a mean loss estimate of 915.4 million rupees. The company’s shares have fallen 31 percent in the past year following the slump in oil prices and uncertainty over the merger with Vedanta, which was announced in June. Brent oil has slipped 25 percent in the past 12 months.
“As it is the stock has got hammered last few weeks and there will be some uncertainty now, which will be negative for the stock in the near term,” SBI Capital’s Agarwal said.