Infosys share price crash: Investors lose over Rs 45,000-crore wealth in single session
BusinessToday.In October 22, 2019
Investors in Infosys share lost over Rs 45,000 crore in market wealth in a single session today as the Bengaluru-based IT firm faced allegations of indulging in 'unethical' practices to generate more profit and revenue from an anonymous employee group, named 'Ethical Employees'.
Market capitalisation of Infosys share on BSE fell to Rs 2,81,883 crore compared to the previous close of Rs 3,26,939 crore on Friday. At 1:02 pm, Infosys investors lost Rs 45,056 crore of their wealth due to negative sentiment surrounding the stock. Infosys stock was the top Sensex and Nifty loser today falling up to 16% on both indices.
On NSE, the IT share fell 16% to Rs 645. On BSE, Infosys share fell 16% intra day to Rs 649.35, 7.44% higher than its 52 week low of Rs 600.65 hit on November 26, 2018. Infosys share has lost nearly 15% in last three sessions. Infosys share is trading lower than its 5-day, 20-day, 50-day, 100-day and 200-day moving averages.
Earlier in the day, the share opened 10% lower on BSE and NSE. Infosys share price was stuck in the lower circuit of 10%, losing 76 points to Rs 691 compared to the previous close of Rs 767.75 on BSE. On Nifty, the stock of the IT major crashed 10% to Rs 691 against the previous close of Rs 767.85.
The large cap stock only saw sell orders and no buy orders on the BSE and NSE. It was the top loser on both Sensex and Nifty today. Yesterday, US-listed shares of Infosys plummeted nearly 16% in premarket trading on Monday. Continuing its pre-morning trends, Infosys ADR opened 15.5 per cent lower at $8.94 and was moving near its 52-week low level of $8.85. Indian markets were closed on Monday for assembly election in Maharashtra.
On Friday, Infosys share price closed 0.18% or 1.35 points lower at Rs 767.75. In a complaint letter to the board of Infosys and the US Securities and Exchange Commission (SEC) on July 20, the group has claimed that the company asked them not to "fully recognise costs like visa costs" in last quarter to earn more profit.
It added that when the auditor pointed it out, the issue was postponed by the company. The group said they were prevented from sharing data on large deals and important financial measures during board meetings.
"CEO and CFO are asking us to show more profits in treasury by taking up risks and make a change to policies. This will provide short-term profits," the group alleged.
Meanwhile, Infosys in a statement said it's investigating the charges. "The whistleblower complaint has been placed before the Audit Committee as per the company's practice and will be dealt with in accordance with the company's whistleblowers' policy," the IT firm said.