DHFL bounces back

about 1 year ago
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DHFL is right there among the top five gainers on the BSE since opening bell. The stock price surged 20% to Rs.160.80 on the back of robust volumes.

The market is very happy with the report which the company released late in the night.

The report, made by independent Chartered Accountant firm viz., Mis. T. P. Ostwal & Associates, exonerated the company from the allegations made by Cobrapost a few weeks ago.

The report clearly says, “The Company has not promoted any of the alleged 26 "shell" companies that are borrowers. Further, it does not have any directors in common, including members from the Promoter group, with any of these alleged "shell" companies. Further, the Company or Promoters do not have any shareholding in these entities, nor are these entities shareholders of the Company. Accordingly, there are no indications to confirm the allegations that the Company has created shell companies to divert funds.”

Pertaining to allegations in respect of loans worth Rs.14,282 crores to 45 borrower-companies that are alleged to be part of Sahana group and/ or Wadhawan group, it did not find merit in these allegations. Further, loans were disbursed during the review period to only 10 entities of the alleged 45 entities amounting to Rs.4,715 crores, of which Rs.1,640 crores have been repaid by the borrowers up to 31-12-2018. No loans were given to any of the other 35 entities during the period of the review

The report does admit that there have been certain lapses and departures from the SOPs and policies laid by the company. These lapses, point to deficiency in the adherence with the policies in several instances - the risk of which needs to be examined by the company.

The report also says that though the company is required to monitor post disbursal end use of funds by the borrowers, its examination indicates the monitoring in respect of 15 borrowers (loans amounting to INR 7,485 crores) is significantly inadequate.

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