PC Jeweller shares rebounded strongly on Thursday after being hammered following negative sentiments due to rumors of its promoter arrest. Its chief financial officer (CFO), Sanjeev Bhatia, clarified that there was no link with Vakrangee Ltd. and that the promoter was not arrested at all. He termed as a rumor about the promoter’s arrest. Before the clarifications came in, the stock plunged about 14.55 percent in the NSE. The stock swung about 34.11 percent from the low to hit Rs.126.8. The stock managed to close with a gain of about 11 percent in the NSE.
Status of Company
PC Jeweller CFO indicated that he was not aware as to how the rumors of his company promoter being arrested spread in the social media. He pointed out that he was with him until last night and even rang up his mobile in the morning once the market opened. He was talking to him for three or four minutes in the morning. Therefore, he failed to understand as to what led the rumor-mongers to spread it.
Responding to questions on why the stock has been witnessing a free fall in the last few days, he said that there had been a number of rumors doing the round for the last one week. One of the clarifications is that Fidelity has sold its stake of close to 10 percent in the company in the last one and a half month period. This has created some selling pressure on the stock. Aside from that, rumors have driven the stock down.
The CFO also refuted rumors about the Central Bureau of Investigation (CBI) questioning him and the promoter, Balram Garg. He said that he was with the promoter till 8.15 in the night on Wednesday. He also said that he was not questioned by the agency in the last six or eight months too. On top of that, Bhatia said that there was no inquiry from the CBI at all, economic times reported. In response to a question whether he suspected anyone for spreading the rumor, he said that he has no knowledge on that.
As far as the connection with Vakrangee, the CFO said that there is no relationship and connection. However, he felt that shareholding was put forward for conversion of CCTS and CCD. As a result, the shareholding of the promoter was reduced automatically during March 17 and 18. Following this, there were rumors of promoters having divested over 12 percent.
The CFO was asked to explain whether there was any query from either the SEBI or the NSE or the BSE. He said that it is a normal thing that whenever there is significant movement of a stock price, his company would get a query from the exchanges. The company would reply to such queries. He also pointed out that the response to the rumors is already in public and that it happened 3 – 4 days ago.
As far as the earnings announcement in time, he expressed the hope that the company would stick to its schedule. PC jeweler has indicated that its quarterly numbers would release on May 25.