The recent turn of events at the Vadodara-based Manpasand Beverages could well make it one of the biggest frauds of corporate India. The company, according to a report by one of its former auditors, Batliboi & Purohit, has been fudging its revenue numbers. The company claimed sales of Rs 1,078 crore in 2018/19, the auditor report pegs it at not more than Rs 144.39 crore. A few months prior to this, the company's senior management was put behind bars on charges of GST violation. The report also talks about identifying several customers which the company claims to be major contributors, but the sales team is not aware of.
The company's share price has dipped from a high of Rs 486 in January 2018 to just Rs 7 in the first week of October. Manpasands senior management has refuted the fraud charges. "It is true that the recent turn of events have led to erosion of stock prices. But there hasn't been erosion of brand value and trust. The majority of our stakeholders are still standing with us. It is a matter of time; our products will be reaching retail outlets," claims Abhishek Singh, Director, Manpasand Beverages.
Even if Manpasand's promoters get a clean chit, it will be difficult to revive trust in their brand.