Freshtrop Fruits: Not Ripe for Investing
Based in Ahmedabad and listed on the Bombay Stock Exchange (BSE) (market-cap: Rs200 crore), Freshtrop Fruits is a leading exporter of fresh grapes from India. Its product portfolio also includes fresh pomegranates, pomegranates arils, fruit pulp and packaged juices. It has two business segments: fresh produce and processed fruits & vegetables. The fresh produce segment consists of export of...
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  • Five Core Electronics Launched IPO in May 2018. Now Promoters Are Untraceable, Company Defunct
    Last year in May, Kolkata-based Five Core Electronics Ltd had filed an initial public offering (IPO) to raise Rs46.66-crore at a price of Rs140 per share. Claiming a 177% subscription for the IPO, on the small and medium enterprise (SME) platform of National Stock Exchange (NSE), the company promoters and directors threw a big party.
     
    However, one year down the line, Five Core Electronics is in doldrums, with its promoters becoming untraceable and a raid by the department of revenue intelligence (DRI) on the company premises. There are no manufacturing activities and the factory and registered office of Five Core Electronics are closed.
     
    On 27 April 2019, Aditya Agarwal, independent director of Five Core Electronics, filed a complaint with the secretary in the ministry of corporate affairs (MCA), reporting 'unethical behaviour' of the company management. He says, "Amarjit Singh Kalra, managing director of the company and other directors, Surinder Kaur Kalra and Jagjit Kaur Kalra are not available in the office in past two months. All key managerial personnel excluding Mr Kalra, have claimed to have tendered their resignations from the company."
     
    "As per the information given to me, critical officers and employees have resigned. It has been noted that presently no production or manufacturing activities are carried out in the factory premises of the company and the factory and registered office of the company are closed," Mr Agarwal says.
     
    Mr Agarwal and Neeraj Sharma, the other independent director of Five Core Electronics, called for a board meeting on 27 April 2019. For this meeting, they invited Amitabh Singh, chief financial officer (formerly as he claimed), Saurabh Kumar Jain, company secretary (formerly as he claimed), Mohit Singhal, secretarial auditor and the company's merchant bankers, Anand Lakhotia and Deepak Sharma, who is director of Sarthi Capital Advisors Pvt Ltd. 
     
    During the board meeting, it was decided to file a complaint with MCA against the Kalras. The board also decided to appoint a forensic auditor and a general manager, but since the registered office and factory of Five Core Electronics were closed and records were not available, the appointments were deferred. 
     
     
    According to statements given by Mr Jain and Mr Singh, the Kalras had told them that from 15 February 2019, they would be visiting the US for 10-12 days on a private trip. 
     
    Within a fortnight, on 27 February 2019, the DRI carried out a search on Five Core Electronics and its group entities and seized certain documents. 
     
    From its peak at Rs145.50 on 21 May 2018, the shares of Five Core Electronics have tumbled to Rs33.35 as on 26 April 2019.
     
     
    Ratings agency CRISIL on 31 May 2018 had affirmed its ratings of Five Core Electronics to 'BBB-' while revising its outlook to positive from stable for the company's Rs91 crore bank loan facilities. This rating was valid till 31 March 2019. 
     
     
    Although, the web page of CRISIL's ratings on Five Core Electronics too has become unavailable, the rating action is available on the company's website.  
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    COMMENTS

    Thomas George

    4 months ago

    SEBI the watch dog is frequently dozing and assumes the role of an "ineffectual angel beating its wings in the void."

    Jairam S Narayan

    4 months ago

    I am shocked at this information. How can one company so brazenly cheat the public? What is SEBI doing?

    REPLY

    kiran

    In Reply to Jairam S Narayan 4 months ago

    Sirji, there have been hundreds of listed companies disappearing after successful IPO’s in the last 30 years after the SEBI act, 1991. Investors have only share certificates/demat in their hands. SEBI is as good or as badly administered as our judiciary & the police.

    kiran

    5 months ago

    With due benefit of doubt to the lady, the other promoters are fit for bouncers jobs.

    REPLY

    Ajeya S

    In Reply to kiran 4 months ago

    Funny but yes, they are fit for that.

    AAR

    5 months ago

    None of them are dressed to impress. I remember Narayanamurthy and team in 1990s how they marketed themselves to promote Infosys.

    kiran

    5 months ago

    Investors can avoid/exit small co.'s IPO's on NSE Emerge/BSE platforms.Many get rich quick are minting crores of Rs in bull market and then the share prices crash.

    Ramesh Poapt

    5 months ago

    let the rating agency/debt bubble burst, worst is welcome!

    SENTHILKUMAR R

    5 months ago

    It is difficult to believe CRISIL rating also. Very pathetic

    Sreepathid

    5 months ago

    You too Brutus ( crisil ).

    Tata Elxsi–Muted Outlook
    Tata Elxsi Limited (TEL) has just announced its results which are uninspiring. In fact, it has posted its lowest quarterly growth since December 2010. Sales went up 8% year-on-year (y-o-y) and operating profit (OP) was up 3.16% y-o-y.
     
    Operating margin contracted to 24.20% in March 2019 from 25.33% in March 2018 while net profit increased marginally by 1.43% y-o-y. Is it a...
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