A Whatsapp message circulating among traders destroyed Infibeam Avenues Ltd’s 71 percent of market value in a single day, raising concern about the eCommerce company’s accounting practices.
A message attributed to brokerage Equirus Securities Pvt began circulating on WhatsApp, said Bhavin Mehta. The message was actually sent a few months ago by an Equirus analyst to some customers and resurfaced on the messaging platform on Thursday, as said by people familiar with the matter, stating not to be identified as they aren’t allowed to speak on such issues.
The circulated message that prompted such a slump clarified to exchanges saying that there was no pending information or announcement that may impact Infibeam’s share price. The message prompted that the company had given interest-free and unsecured loans to its units. According to the company’s annual report, Infibeam has provided unsecured, interest-free loans of 1.35 billion rupees ($18.6 million) to related firms for business operations as of March 31.
In the business-to-business and business-to-consumer space Infibeam, one of the authorized online retailers for Apple Inc.’s iPhone and iPad product lines, operates an eCommerce platform according to its website. Early this year, the company had claimed to add 1,500 merchants every month, with revenues growing 100 percent annually in the past five years.
The Infibeam stock slumped by 73% before closing 71 percent lower at 58.45 rupees on Friday in Mumbai.