HYDERABAD: Beleaguered Karvy Stock Broking, currently under the Sebi radar for alleged misuse of clients’ shares, postponed its annual general meeting (AGM). Sources told TNIE the company has sought an extension from the Registrar of Companies, Hyderabad and has till December 15 to hold the meeting.
Consequently, Karvy Group’s standalone and consolidated financials, too, will be delayed and submitted only after the AGM. While officials termed the delay due to procedural issues, analysts believe trouble has been brewing at the company for sometime now.
“We sensed that our audit procedures may take time and sought extension from the RoC. Now that we have completed auditing our financials, we will hold the AGM on December 8 or 9,” a senior Karvy official told TNIE.
The proposed emergency board meeting to deliberate on Sebi’s order banning the firm from undertaking fresh business will be held next week.
According to the Companies Act 2013, firms must hold an AGM within six months into the financial year — that is, by September 30. However, under Section 96 of the Act, Karvy was given 45 days extra.
Officials say this was the first time in recent years that Karvy has sought additional time for statutory compliances.
Incidentally, some of the group companies’ financial disclosures to the bourses, too, are behind schedule.
“All submissions will be made by December 15,” officials clarified.
Curiously, one of the nominee directors, Baring Private Equity Asia MD Ashish Agarwal, stepped down from the board on July 14 — just weeks before the NSE began its investigation into Karvy on August 19.
When contacted, Karvy Group Chairman C Parthasarathy dismissed impropriety charges and maintained there was no misuse of clients’ funds.
Sebi Rap
Karvy Stock Broking had been indulging in activities that were ‘never allowed’, Sebi Chairman Ajay Tyagi said on Wednesday.