Eros goes awry

Eros International is in news today but not good news; on major corporate governance issues, SEBI banned the company, its CEO and promoters from the market over alleged breach of trade practices.

SEBI, after a detailed probe of the company’s financials, concluded that there is enough to show that there has been a deliberate attempt to misrepresent the numbers and/or siphoning off funds.

The forensic  auditor who was appointed by SEBI to examine the books concluded that the company seems to have overstated its financial records by including revenue receivable from potentially fraudulent entities.

Following this news, the stock price naturally tanked today; the stock opened itself more than 19% lower at Rs.21.08 but from there, recovered a bit to Rs.22 levels, nevertheless, down 16%. Its 52-week low is at Rs.20.