Shares of the Hyderabad-based state-run bank Andhra Bank dropped 14% to nearly 14-year low as the investigative agency Enforcement Directorate filed a charge sheet against the former Andhra Bank director in an alleged Rs 5,000 crore fraud.
Shares of the Hyderabad-based state-run bank Andhra Bank dropped 14% to nearly 14-year low as the investigative agency Enforcement Directorate filed a charge sheet against the former Andhra Bank director in an alleged Rs 5,000 crore fraud. The alleged Rs 5,000 crore bank fraud involves a Gujarat-based pharmaceutical firm Sterling Biotech Pvt Ltd, PTI said in a report. Following the blow, a knee-jerk reaction was witnessed in the shares of Andhra Bank on Monday. The stock of Andhra Bank nosedived 13.87% to a nearly 14-month low of Rs 33.2. Shares of Andhra Bank hit the lowest since 2004 on Monday. As on 17 May 2004, Andhra Bank shares marked a low of Rs 33 on NSE.
A huge trading volume has been observed in the shares of Andhra Bank, as at 10:50 am, more than 2.19 crore shares exchanged hands on both NSE and BSE with about 2.03 crore share on NSE alone. Due to a steep decline in the share prices, about Rs 428 crore was wiped off from the market capitalisation of Andhra Bank. At the day’s low of Rs 33.6 (BSE), Andhra Bank held a market capitalisation of Rs 2,937 crore as against Rs 3,365 as on Friday, 9 March 2018.
Meanwhile, shares of the pharma firm Sterling Biotech allegedly involved in the fraud shed as much as 3.51% and touched lower circuit hitting a 52-week low of Rs 2.75 on NSE. The CBI had booked the Sterling Biotech, its directors Chetan Jayantilal Sandesara, Dipti Chetan Sandesara, Rajbhushan Omprakash Dixit, Nitin Jayantilal Sandesara and Vilas Joshi, chartered accountant Hemant Hathi, Garg and some unidentified persons in connection with the case.
Anup Prakash Garg, ex-Director, Andhra Bank, was paid about Rs 1.52 crore by Chetan Jayantilal Sandesaraand Nitin Jayantilal Sandesara, directors, Sterling Biotech, between 2008 and 2009, PTI reported. Sterling Biotech took loans more than Rs 5,000 crore from a consortium led by Andhra Bank, which turned into NPAs (non-performing assets).