Sadbhav Eng hits a new high again

Sadbhav Engineering had hit a new high at Rs.133.30 on Thursday and today morning too, the counter remained bullish, with the stock hitting another new 52-week high at Rs.137.

The stock is on a high after the company issued a clarification, stating that there was no merit in news that the Company Law Borad has passed an interim order for conducting forsensic audit of the accounts of its subsidiary, Bijapur Hungud Tollway. One minority shareholder had alleged that this subsidiary is manipulating the books by showing lower income through toll collection and Sadbhav is said to have siphoned off Rs.200 crore from this subsidiary. The company has denied these allegations too, saying these were completely frivolous accusations.

One minority shareholder had accused the company of diversion of funds, complaining to the Company Law Board and the High Court of Gujarat had directed Sadbhav to not move ahead, staying even interim reliefs granted by the CLB. Later, the high court modified its order to the extent of permitting the minority shareholder to approach the CLB to try and enforce the interim relief granted, while allowing the company to challenge the maintainability of any such proceedings. The minority shareholder even accused the company of disobedience of CLB’s order.

The company has stated that all the allegations made by the shareholder were frivolous, incorrect, baseless and defamatory. It has stated in the Press Release that despite this, it permitted the minority shareholder to carry out inspection of the project site/toll plaza on 19-20 February 2014. The company said it was also willing to permit the minority shareholder to inspect the statutory records of the company on 26 February 2014 in exercise of its rights as a shareholder, after the Stay Order was passed, albeit without the involvement of any third parties. But the minority shareholder did not turn up for inspection at the appointed date and time. Moreover, the company has provided an undertaking to the High Court that all agreements that are proposed to be executed by the company will be subject to the prior approval of the High Court. The company said that it is apparent from its conduct as stated above, that it has not, nor does it intend to, disobey any orders passed by the CLB.