Vakrangee share price plunges 5% on reports company may cancel buyback, dividend

Vakrangee share price slipped 5 per cent to hit its lower circuit after the tech firm involved in BFSI said its March-quarter consolidated profit nearly halved, hurt by nearly 50 per cent surge in total expenses. 
 
The company reported 49.82 per cent year-on-year fall in net profit at Rs 75.96 crore in the March quarter. It had posted a net profit of Rs 151.39 crore in the same quarter last year. 
 
Reacting to this, the stock fell as much as 5 per cent to Rs 41.20 on the BSE. On a year-to-date basis, the stock has fallen over 90 per cent.
 
Meanwhile, media reports say the company cancelled Rs 1,250 crore buyback and dividend announced a few months ago. It will instead spend money on buying ATMs for over 45,000 kendras for Rs 2 lakh each, the report said.  
 
Vakrangee said based on the current Capex plan for the ATM business and increased spend in marketing expenses, it plans to change the capital allocation policy.
 
“Capital allocation policy to be finalised based on the outcome of 5,000 operational Next gen outlets," the company said. 

Vakrangee stock has taken a beating following the resignation of Price Waterhouse & Co as auditors on concerns about company’s accounts, mainly related to its bullion and jewellery business. 
 
There are reports that Vakrangee was facing regulatory scrutiny on alleged disclosure and corporate governance lapses. However, the company said it would like to highlight that we have not received any show cause notice either from stock exchanges or Security Exchange Board of India (SEBI) or any regulatory body for being involved in any price and volume manipulation.
 
"The rumors of involvement of company in price and volume manipulation are completely baseless and factually incorrect," it said.