Billionaire couple Dinesh and Jyoti Nandwana, promoters of Vakrangee Ltd, together saw over $2 billion wiped out from their fortunes in just seven trading sessions, as the company's stock plunged on reports of share price manipulation.
Shares of Vakrangee, 42 percent owned by the Nandwanas, fell 57.9 percent from their 25 January peak of Rs 505 to Rs 212.8 apiece on Tuesday’s close. The stock hit the lower circuit for five straight sessions after the Mumbai Mirror reported that the market regulator Securities and Exchange Board of India had launched a probe into alleged price and volume manipulation of the Vakrangee scrip.
In an interaction with BloombergQuint, Dinesh Nandwana, who is also the managing director and chief executive at Vakrangee, denied the allegations.
SEBI, in the report, has said that no adverse inference is drawn from the investigation and may not pursue this matter any further. So we are denying any allegations of wrongdoing.Dinesh Nandwana
The Nandwanas entered the billionaire club earlier this year riding on Vakrangee's stellar run on the equity market. The stock had soared more than 4,400 percent in seven years — helped by a surge after demonetisation in November 2016.
Backed by the likes of Life Insurance Corporation of India, Credit Suisse, BNY Mellon and Vanguard Group, the company runs more than 35,000 digitally connected kendras or outlets across 16 states that take deposits, offer loans, sell insurance, collect taxes and utility bills, let people apply for passports and even enroll them for the Aadhaar biometric ID.
It has also tied up with 31 lenders, including the country’s largest — State Bank of India — to offer financial services, its website said.
Founded in 1990 as an e-governance services provider, a change in business model helped Vakrangee boost its growth trajectory. It shifted its focus to the franchisee kendras in 2012.