Shares of infrastructure company IVRCL were hammered down as reports of murder of Paulose Thomas, an expert consultant with National Highways Authority of India (NHAI) surfaced.
Shares of infrastructure company IVRCL were hammered following allegations of foul play by family members of a consultant who was murdered while on a NHAI project being executed by an IVRCL arm.
Speaking to CNBC-TV18, S Ramachandran, director of IVRCL said he has "no idea" why the stock crashed the way it did. "The company is working as usual. It is having its problems and its challenges as usual in terms of any infrastructure company, which all of you know. We are working our way to see how we come through the general problems in the industry. It could be to do with working capital, (or) it could be to do with the slow pace at which work is happening. But that’s something, which is very common. There is nothing new," he says.
According to reports, Paulose Thomas, expert consultant with NHAI was found dead at his Coimbatore apartment over a month and half ago. The autopsy report has revealed that Thomas was murdered. Thomas’s family members have alleged that his death could be connected to some irregularities in the project.
Ramachandran says it is quite possible that some of IVRCL employees maybe questioned. "One thing is I don’t see anybody having accused IVRCL. If they have then they will be in trouble because they have actually mudsling the company and we will not accept that," he told CNBC-TV18.
Below is edited transcript of the interview on CNBC-TV18.
Q: If you can just give us any indication of what went wrong today? Your stock price crashed over 20 percent correction.
A: We have absolutely no idea. I got somebody to give me the news. I think it was Indian Express or so. There are talks about the death of one of the consultants; the independent engineer. And that’s our Chengapalli road, which we are currently implementing. Chengapalli-Walayar is the one, which we are currently working on. It is under construction. It is in two phases: 42 and 12 kilometres. The 42 km phase is right up to Coimbatore. We have absolutely nothing to do (with the report) and we have absolutely no idea.
It is an individual who is no more for reasons either known to him or his family or his friends or maybe his employer. We have no idea. I don’t understand; if this is the reason, (then) why this stock has tanked because I cannot see anything else because company is working as usual. It has its problems and its challenges as usual in terms of any infrastructure company, which all of you know.
We are working our way to see how we come through the general problems in the industry. It could be to do with working capital, it could be to do with the slow pace at which work is happening as well as whatever issues we may have with anybody including NHAI on some of our roads in terms of land. But that’s something which is very common. There is nothing new.
Q: The family of the NHAI consultant has accused IVRCL to be behind this alleged murder. Is there any kind of CBI raid or anything that has taken place?
A: None whatsoever. If somebody has died, there is a link between his work, it is obvious that people will be questioned, including his parents or his brothers, his friends, his own bosses and the people for whom he was supervising, including IVRCL. It is quite possible that some of IVRCL employees maybe questioned. It is extremely normal. One thing is I don’t see anybody having accused IVRCL. If they have then they will be in trouble because they have actually mudsling the company and we will not accept that.
I am not sure because I don't seem to have any direct accusation on our company. Whoever has done that will be in deep trouble.
Q: Can you tell me what is the percentage of pledged shares that the promoter has and was there any kind of institutional selling that you saw in the market today?
A: I cannot say. The promoter, as you all know, has about 13 percent in this merged entity -- IVRCL Assets and Holdings into IVRCL. There is no pledging to the best of my knowledge. The company is on a standalone. I don’t know if somebody is selling; maybe (because of ) their perception of how the market is or some other stock is. They (sellers) could more enticed to the another stock but if this news of today is the reason then whoever has done that, it is their bad luck because it will come back again because this is absolutely a ruthless and uncalled for.
Q: Has there been any kind of CBI enquiry or probe?
A: No CBI enquiry. Police would obviously call the people all around -- distant/nearby -- to ask, "What do you know about this? Do you have any idea?". Definitely, our site person would probably have to meet them and say what I am trying to tell. We are working, they are doing our road. If somebody for reasons known or not known to us expires, we are in no way answerable.
IVRCL stock price
On September 19, 2014, IVRCL closed at Rs 17.60, down Rs 1, or 5.38 percent. The 52-week high of the share was Rs 30.75 and the 52-week low was Rs 9.80.
The latest book value of the company is Rs 47.26 per share. At current value, the price-to-book value of the company was 0.37.
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