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DHFL: Share goes from 667 to just 16
We have already shared with you the story of the fall of Yes Bank shared that started with arrest of Rana Kapoor, Co-founder of Yes Bank. But on that same day, 8 March 2020, CBI also investigated Kapil Wadhawan, former Chairman of Dewan Housing Finance Ltd (DHFL), on charges of criminal conspiracy and cheating under relevant sections of the Prevention of Corruption Act.
The case was Yes Bank related as Rana Kapoor had invested Yes Bank;s 3700 Cr in short-term Debentures of DHFL, and Wadhawan had paid 600 cr to Kapoor in form of loan for his company DoIT Urban Ventures, controlled by Kapoor’s family.
From then it has been 2 years of rigourous investigation by agencies such as CBI and ED, and on 22 June 2022, CBI booked Dewan Housing Finance Limited or DHFL and its Directors Kapil Wadhawan, Dheeraj Wadhawan and others for allegedly defrauding 17 banks of Rs 34,615 crore. This is the largest bank fraud case in the history of India so far.
But what about the investors of DHFL, common shareholders who believed that DHFL was getting all the loans for all the right reasons. One such investor, Ranganathan of Mylapore, submitted a PIL to Madras High Court, alleging that investors may have lost in excess of ₹40,000 crore, with regulators, credit-rating agencies, auditors and others, people who were responsible for looking into DHFL’s inner workings, its misuse of loans.
Ranganathan prayed in his PIL that court should summon SEBI as this could be the “biggest scam of the capital market of India”. HC paid attention, as on 28 June, HC ordered SEBI to file a response in due time this month.
