Cant comment on management intent but perhaps the drop in share price has been equated with management intent.
In my view, the problems of Shankara are operational in nature and the root cause is mismatch in working capital cycle with cash flow leading to a debt buildup. These issues are not beyond repair but will take time to rectify. It cant be denied though that the balance sheet has been stretched and maybe needs to be recapitalized in the near term.
Scaling down operations, while important at this time, comes with its own set of issues. Its a tricky catch-22 situation and hopefully the management will come out of it.
Chain stores have good economics in general and what needs to be seen is the reduction in the working capital cycle. Currently its 75 days. Maybe a 45 day cycle would change its fortunes.
Best
Bheeshma