DLF stock may tank following financial impropriety dealings with Vadra

Stocks

oi-Sneha

By Sunil

Updated: Saturday, October 6, 2012, 11:34 [IST]

The DLF stock is likely to drop on Monday following allegations by Arvind Kejriwal that Robert Vadra, son-in-law of Congress President Sonia Gandhi, had in last four years amassed 31 properties, worth hundreds of crores of rupees even at the time of purchase, from DLF, at a dirt cheap rate.

DLF also gave an unsecured and interest-free loan worth Rs 65 crore to companies owned by Robert Vadra. DLF, in its statement, said, "Our business relations with Robert Vadra are completely transparent. The relationship was conducted to the highest standard of ethics."

Markets generally punish stocks where there is a perception of poor corporate governance and in the past it has for the DLF stock.

Earlier, Veritas Investment Research, in its report titled 'A Crumbling Edifice', had raised doubts about the company's disclosed book equity and asset base.

The report said, "DLF has undertaken questionable related-party transactions to boost the value of DAL (DLF Assets) prior to its acquisition by DLF, thereby subverting the interests of minority shareholders via a higher purchase price for DAL."

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