In an earlier post, I had briefly commented on Arshiya International.
Today again Arshiya has hit the lower circuit.In an article in Economic Times, employees of the company had alleged financial irregularities in the company.
“The promoters have misguided investors, stakeholders by painting a rosy picture so far, while the company is hollow – it is a mini Satyam,” said one of the sacked employees.”
Some bloggers had also wondered
how is that Arshiya with a networth of @ Rs 550 crs and ROCE of @ 10% and a Market Cap of under Rs 800 crs and a relatively high Debt Equity is executing Warehousing Projects of Thousands of Crs.
Only time will tell if Arshiya will turn out to be like DCHL.In the meantime, the ill-fated investors will have to grin and bear the losses.
3 replies on “The fall of Arshiya International”
Hi, In your view, what is the probability that you’ll like to assign to there being corporate governance issues with the company ? If you feel the probability is zero, would you recommend buying the stock at current levels?
Best,
DV
The probability is distinctly non zero.Merging of subsidiaries/not having complete debt on books are usually signs of corporate governance issues.Check out this conference call transcript…more specifically when debt is discussed http://www.aceanalyser.com/Conference%20Call/106074_20120816.pdf
Hi, Agree. Things do look catastrophic when seen from the debt management view point. Will be interesting to see what Helios Capitals’ views are at this point in time ! It’s easy to recommend such stocks when the environment is bullish….
Thanks for your revert.
Best,
DV