Shares of Mumbai-based IT firm Vakrangee Ltd crashed 5% to hit a lower circuit in early morning trades on Friday after the company reported 50% plunge in the consolidated net profit for January-March quarter of the financial year 2017-2018.
Shares of Mumbai-based IT firm Vakrangee Ltd crashed 5% to hit a lower circuit in opening trades on Friday after the company reported 50% plunge in the consolidated net profit for January-March quarter of the financial year 2017-2018. Notably, Vakrangee share price went up by 3.52% to Rs 42.65 from the day’s low of Rs 41.2 at around 9:33 am on Friday. Shares of Vakrangee have been on a roller coaster ride since October 2017 till now. In the span of last 8 months, Vakrangee shares hit an all-time high share price and have subsequently dropped to multi-year low.
Five points to note:
- The stock of Vakrangee Ltd shed 4.96% to a day’s bottom of Rs 41.2 on both BSE and NSE on Friday. The stock of Vakrangee was locked in the lower circuit. Up until 1 pm on Friday, about 2.25 crore equity shares of Vakrangee got exchanged on both NSE and BSE.
- Earlier yesterday, Vakrangee Ltd posted a 49.82% decline in the consolidated net profit of the fourth quarter ended 31 March 2018 to Rs 75.96 crore from Rs 151.39 crore in the same quarter last year.
- The sharp reduction in the consolidated net profit was mainly due to invariably higher “other expenses” in the reporting quarter. According to the latest financial results filed by Vakrangee, other expenses surged 1888% to nearly Rs 228 crore in the Jan-Mar period of FY18 as compared to Rs 11.46 crore.
- Other expenses include Rs 219.95 crore (net-off amounts of allowances for credit losses considered in previous years) towards amounts written off as bad debts pertaining to the legacy business of e-governance, during the quarter ended 31 March 2018, Vakrangee said in an exchange filing.
- The consolidated total income of Vakrangee Ltd in Q4 of the fiscal year 2017-2018 rose 62.66% to Rs 1,866.57 crore as against a net income of Rs 1,147.53 crore in the corresponding quarter a year earlier.
Vakrangee Ltd is a technology company involved in the BFSI (Banking, Financial Services and Insurance) services with a government-to-citizen and business-to-consumer model. Based on current CAPEX (Capital Expenditure) plan for ATM business and increased marketing costs, Vakrangee said it plans to change its capital allocation policy at a later time, Reuters said in a report.
Shares of Vakrangee made an all-time high of Rs 515 on 24 January 2018 and a multi-year low of Rs 30.85 on 7 June 2018 on NSE. The stock of Vakrangee also declined after Price Waterhouse & Company resigned from the post of the statutory auditor on concerns over company’s accounts. Reportedly, Vakrangee was also facing a SEBI probe on alleged disclosure and corporate governance issues. Yesterday only, Vakrangee said that it didn’t receive any show-cause notice from stock exchanges or any regulators for the so-called involvement in price-volume manipulation.