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Thursday, May 09, 2002

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Q4 results prove elusive for investors

R.Y. Narayanan


A STRING of blue-chip companies have opted to come out with audited results for the full year instead of publishing the unaudited results of the fourth quarter (Q4) of the just concluded fiscal 2001-02.

This has deprived the investors of valuable information about the companies' performance in the fourth quarter of the last financial year to enable them to take an informed decision on continuing to hold, enter or exit from a stock.

The list of companies which so far have notified the Bombay Stock Exchange, as per published information, about their decision to go for publication of audited results for 2001-02 financial year before June 30, 2002 and not to come out with Q4 figures for 2001-02 includes Sterlite Industries, Tata Power, Tata Engineering, Aurobindo Pharma, Colgate-Palmolive, India Cements, ITC, Mahindra and Mahindra, Britannia Industries, Nirma, Bank of Baroda, BSES, Hindustan Lever Chemicals, Tata Steel, HPCL and Shipping Corporation of India (SCI).

It is interesting to note that of these companies, at least two - HPCL and SCI - are facing prospects of disinvestments, with SCI being put on the block earlier than the petroleum giant.

That many of them are from the BSE `A' group and are market leaders in their respective segments also could not be missed.

Companies are within the law in choosing to come out with audited results inside three months of the ending of the last financial year.

Speaking to Business Line, Mr K. Annamalai, former President, Coimbatore Stock Exchange (CSX), said in the absence of any specific information from the companies about the reason for their decision to publish the audited results for the full year and not the fourth quarter unaudited results for 2001-02, the investors would be kept in the dark about last quarter performance for three months.

Mr Annamalai also said that this would deny the investors crucial information.

He said with information technology playing a pivotal role, it would not be difficult for companies to quickly finalise details of their financial performance, particularly as it was based quarter-to-quarter.

He suggested that SEBI should look into the issue of insisting on companies disclosing material reasons for any decision to skip publishing the unaudited results for the last quarter of the year and taking recourse to publication of the audited result for the full year.

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