Amidst a bullish start to Thursday's trading session, Polycab India witnessed a stunning 20% plunge in its stock price, triggered by a series of Income Tax department raids across its offices.
The raids, conducted in Mumbai, Pune, Chhatrapati Sambhajinagar, Nashik, Gujarat, and Delhi, unearthed a trove of evidence hinting at potential tax evasion practices by the company.
Key Findings of the Raids:
- Missing Documents: Crucial documents pertaining to ₹1,000 crore worth of sales were reportedly missing from company records.
- Unaccounted Cash: A sizeable sum of ₹4 crore in unaccounted cash was seized from the offices.
- Locked Bank Lockers: Authorities sealed 25 bank lockers for further investigation.
Allegations Against Polycab India:
- Tax Evasion: The company is suspected of deliberate underreporting of income and tax avoidance.
- Fictitious Transactions: Concerns have been raised about the potential presence of fabricated sales records.
- Concealment of Revenue Sources: Investigators are probing claims of hidden income streams.
Market Impact:
- The raids triggered a massive sell-off, leading to a 26% decline in Polycab India's shares over the past five days.
- The stock price has tumbled by 30% in just the past month.
Company Response:
Polycab India vehemently denied the allegations, maintaining that they abide by all tax regulations