Hours after its shares plunged over 70 percent, Infibeam Avenues said it has given interest free unsecured loan to its subsidiary NSI lnfinium Global Pvt Ltd.
"These loans are short-term loans which are repayable on demand and have been utilised by NSI solely for its business and operations," the company said in a statement, adding that the closing balance of loan to NSI stood at Rs 1,350 million as on March 31, 2018.
NSI is involved in the business of online multi-brand retail trading activity through web portal and also operates a marketplace for products, to enable sale of various products on line by merchants. It operates the flagship portal of Infibeam.
NSI also owns e-commerce technology platform Buildabazaar for products for merchants to build their online presence which comes integrated with their own payment gateway and logistics couriers.
"Given the nature of business of NSI, the net worth of NSI has been negative. However, please note that the net worth of NSI has improved in the last two fiscals and the company expects net worth of NSI to improve in coming years," the statement added.
The shares of Infibeam Avenues nosedived a day ahead of its Annual General Meeting.
A Bloomberg report attributed the decline to a WhatsApp message which went viral on Thursday.
The message, also received by Moneycontrol, states that the company gave interest free and unsecured loans to subsidiary with repayment over eight years.
The message also suggests that the co-founder continued to be a large investor in the company as non-promoter.
The company however clarified that there has been no change in the promoters from the list of promoters identified and disclosed in the offer document for its initial public offering.
"The shareholding of promoters and promoter group was 45.63% as on March 31, 2018. In May 2018, total 11,98,60,000 equity shares were issued to the shareholders of transferor company post receipt of merger order and hence the shareholding of promoters and promoter group was decreased from 45.63% to 37.38%. As on June 30, 2018, the shareholding of promoters and promoter group was 37.90%. We confirm that there is no sell of equity shares of our company by any of the promoters of our company since its listing on the Stock Exchanges and all the above details have been timely and fully disclosed and are available on the stock exchanges," it said.
According to the Bloomberg report, the Whatsapp message was sent a few months ago by an Equirus analyst to some clients and resurfaced on Thursday.
However in a statement to Moneycontrol, Equirus Securities said that it has "only released the post-conference note as enclosed and there has been no report from our end on the company".
The decline managed to wipe over Rs 9,200 crore of the wealth of Infibeam's investors.
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