Shares of DLF continued to witness selling pressure on Friday as investors offloaded positions after Vertias recommended a ‘Sell’ on the stock. Shares of DLF, the Delhi-based real estate major, fell 5% on Friday as a fallout of a research report by Toronto-based Veritas Investment. Veritaas Healthcare in DLF Phase I, Gurgaon. Book Appointments Online, View Doctor Fees, address, for Veritaas Healthcare in Gurgaon | Practo.
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Veritas report says DLF overpriced, stock starts falling | business | Hindustan Times
C anadian research firm Veritas, which has questioned corporate governance issues and accounting practices at Reliance Industries, Reliance Communications, Kingfisher and most recently DLF, has claimed that none of these companies have reached out to it so far in reaction to its reports.
This, despite all these firms rubbishing the Veritas reports in their respective statements to the media, and some even threatening legal action against the Canadian company.
Neeraj Monga, executive vice-president, Veritas Investment Research, told Business Standard”We have not heard from anyone,” referring to the companies it had slammed over the past several months.
He added that “nobody can sue on opinion”, as Veritas had used publicly filed and audited financials. The research firm’s latest target, DLF, is learnt to be exploring ways to change the perception that the report may have created. A Veritas vetitas on Thursday said DLF’s balance sheet was stretched and its stock price should not exceed Rs in a best case scenario, prompting the company shares to fall two days in a row.
The industry buzz is that DLF could explore the option of approaching the Securities and Exchange Board of India Sebi with concerns that the Veritas’ latest report on the realtor smelt of a bear cartel. Monga refused to respond to the speculation, saying, “No response to rumours.
Let’s hear it from them DLF officially. Indian analysts, on their part, said the Veritas report has no real surprises. Such reports existed when the company’s stock verifas trading at Rs 1, Rs or even Rs ,” said an analyst, emphasising that the share price of DLF had been falling anyway. What differentiates Veritas from other read Indian research reports is their tone and language.
An analyst backing the Veritas veritax pointed that there were a large number of brokerage firms which rate the dlc as ‘sell’ or ‘hold’. I’m surprised that those having ‘buy’ ratings are not called part of a bull cartel,” he added. Most Indian analysts rubbish the ‘bull’ or ‘bear’ report theory, especially in the case of promoter-owned companies such as RIL and DLF.
Given that there is little floating stock of these companies, any cartel would have to pay through their nose if they try to run it down,” said an investment banker.
According to Monga, dof can disagree with our valuation opinion, but can’t sue us over it. The Indian market has known about this all along. No one has come out and said that related party transactions that boost sales and profits should be excluded from the core earnings power of a business,” Monga told this newspaper in an email reply from Toronto.
When asked to compare the Indian companies that Veritas had written about so far, Monga said, “These are all struggling companies with distinctly different issues, with the common theme of poor corporate governance. Veritas primarily covers large capitalisation Veritaa equities.
On whether Veritas was planning to look at any of the telecom companies caught in the 2G spectrum scam in its reports, Monga replied, “The entire vrritas is engulfed.
Who should I name? Denying the charges, DLF had termed the report in question as ‘presumptive and mischievous’, adding that the analysts had never contacted the company before preparing the report.
DLF says report that hit its shares ‘mischevious’
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