Market cap of Rs 3 lakh crore destroyed by bear cartel: ADAG

A day after the group’s stocks fell by up to 19 per cent, ADAG Group CEO Gautam Doshi told a conference call with investors and journalists that the group has written to market regulator Sebi, the stock exchanges and intelligence agencies to look into the matter.  On Wednesday, five ADAG firms had collectively lost more than Rs 12,000 crore in market cap.

“There have been concerted efforts to destabilise the markets and the investor sentiments,” Doshi said, adding that rumour-mongering by unscrupulous elements have led to the sharp fall in the group stocks.  The group, according to him, intends to take strong legal action against those behind the spread of the rumours, as well as those making irresponsible statements about the group.

Doshi also made it clear that the group companies, Reliance Infra and RNRL, as well as their statutory auditors, have not received any notice from auditing regulator ICAI with regard to the consent settlement reached by the two companies with Sebi.

The group stocks bounced back this day defying the overall bearish sentiment in the broader market and surged by up to 11 per cent in early trade.  Eventually Reliance Infra closed the session at Rs 585.25, up Rs 50.55 or 9.45 per cent from the previous closing, while RNRL. At 12 pm Reliance Infra was trading 10.81 per cent higher on the BSE.

The group made a brief statement this morning in the interests of their 11 million investors stating that they have written to the market regulator Sebi, the stock exchanges and intelligence agencies to immediately investigate these concerted efforts to destabilise the capital markets, and create panic amongst investors.

Surprised at the distorted reporting in a section of the media, attributing certain observations to the ICAI, the Group clarified that Reliance Infra has not received any queries from ICAI on its accounts for any year. ICAI has simply asked for copies of audited Balance Sheets, which are already in the public domain and have been circulated to over 1.5 million shareholders. In any case, the group said, the Reliance Infra will continue to extend all co-operation to ICAI and respond to any queries, if and when raised.

At the same time, it said, “We would urge discretion to be maintained by a professional body like ICAI, especially in relation to price sensitive comments and observations to the media.” The proceeds of the Certificates/Deposits referred to in the Sebi Consent Order dated January 14, 2011 have been repatriated back to India by Reliance Infra in 2007-2008, more than 3 years ago.