Edelweiss bounces back

On Friday, the stock price of Edelweiss Financial Services crashed nearly 10% after news came in that the Enforcement Directorate has summoned the group's chairman Rashesh Shah in an alleged forex scam.

The company issued a clarification much after market closure that it has indeed received a communication from the Enforcement Directorate to appear and provide information about Edelweiss Group Companies' dealings with a company called 'Capstone Forex Pvt Ltd.'.

Rashesh Shah said, “We would like to state that none of our companies have any transaction with this company - Capstone Forex Pvt Ltd. We further deny the wild baseless allegations contained in the news items which are apparently attributed to unidentified sources.”

The company said, “Media reports suggest that Mr. Sanjay Nathalal Shah, Chartered Accountant and an independent director of a few of our group companies, is alleged to be connected to Capstone. Let me reiterate that he has no other association with the Edelweiss Group, nor is he in any way related to me; you will appreciate that Shah is a common name.”

The stock price recouped today. From Fridays close of Rs.106, it opened lower at Rs.100.80  and went on to hit an intraday high at Rs.114.50. , which is not too from its 10% UC at Rs.116.60.