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Deccan Chronicle shares tank on forgery complaint by Karvy

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Shares of Deccan Chronicle Holdings Ltd (DCHL) hit an all-time low of Rs. 13.95 on Wednesday, down 9.71 per cent from yesterday’s close, following a criminal complaint by Karvy Stock Broking Ltd.

In the complaint to Central Crime Station here late on Tuesday, Karvy alleged that the promoters of Deccan Chronicle, T. Venkattram Reddy, T. Vinayak Ravi Reddy, P. K. Iyer, and others have cheated it by using forged documents.

The police have filed a First Information Report. According to the FIR, “DCHL, being a depository account holder with Karvy, used forged letters, misrepresented facts that a higher number of shares existed in their accounts for availing loan against them. This was breach of trust and forgery.”

The promoters of DCHL had pledged 11.28 crore shares with Future Capital to raise about Rs 120 crore for Deccan Chronicle and Rs 50 crore for Aviotech. Karvy has only 6.04 crore shares.

The promoters have also pledged 14.46 per cent stake with Religare Finvest Ltd. Industrial Finance Corporation of India has filed a wind-up petition against DCHL, stating that the company had almost become insolvent.

IFCI approached the Andhra Pradesh High Court after DCHL defaulted on the redemption of 250 debentures.

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(This article was published on August 1, 2012)
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