Infibeam complains to IT Minister and Sebi about WhatsApp message

AHMEDABAD: Infibeam Avenues, India’s first listed ecommerce company, has complained to the government and Securities and Exchange Board of India about a WhatsApp message that wiped off 73 per cent of share price on Friday.

Last week, a WhatsApp message, allegedly attributed to brokerage Equirus, raised questions on Infibeam’s accounting policies and corporate governance. The note also mentioned that the company gave an interest-free and unsecured loan to a subsidiary with negative net assets to be repaid over eight years. It further said that the company has re-classified its co-founder, who continues to hold a large chunk of shares, as non-promoter.

The same day, Equirus Securities denied issuing any such note.

The message led to large sell-off in shares, a 71 per cent fall in price to Rs 57.90, the steepest single-day fall in share price of any company since Satyam Computer Services shares crashed 83 per cent on January 7, 2009.

Infibeam clarified its position on the same day to both stock exchanges stating that it has done no wrong, and that has strong fundamentals.

On Sunday, Infibeam after its late meeting with top officials, complained officially to Ravi Shankar Prasad, minister of ministry of electronics and IT, who also holds law & justice ministry in its portfolio and Sebi about the rumours.

“I wish to draw your kind attention that the country has been reeling under the rumours and misinformation which have been spread via WhatsApp platform across the country and there are enough recorded incidence to prove that how WhatsApp rumours has been disturbing our country’s social fabric and impacting as well as have created challenges for law & order situation in last few years,” the letter written to by founder and CEO Vishal Mehta said.

“I would like to bring to your notice that the nuisance of rumours via WhatsApp, which is now not just limited to social disturbance but has also started creating economic disturbance. My company’s example aptly fit here.”

“I and my entire company team have worked very hard with integrity in past several years. But some unknown person/institution/ Group using the WhatsApp platform have attempted to tarnish my company, which has adversely impacted small retail investors of my Company, who have paid a heavy price in terms of erosion of share price.”

“This kind of viral WhatsApp rumour if keeps on repeating with other Indian corporates, will certainly shake the trust of small retail investors and other investors in the Indian corporate growth story. Just imagine, if such viral WhatsApp rumour is done in much larger scale with multiple listed corporates/entities in one single day with serious bad intention of some person/institution/ Group or even foreign nation, what kind of adverse impact or economic terrorism would be unleashed on the corporates, on Indian economy as well as on the small retail investors who put their life time hard earned money in a company’s stock,” the letter said.

Infibeam requested the IT ministry to immediately clampdown on WhatsApp rumours and also to impress the Facebook-owned WhatsApp company to bring in technology to make the WhatsApp messages traceable to origin.

Infibeam also requested that the Government of India (“GOI”) should immediately clampdown on such economic offense done via WhatsApp viral rumour terrorism which has high potential to tarnish Indian economic growth story and spread economic & financial mayhem.

“We are also marking CC of this email to Sebi chairman Sir and respective whole time members to take effective and necessary steps in this matter,” said Mehta in his letter to the IT minister.

Infibeam which was founded in 2007 by former Amazon executive Vishal Mehta, operates a horizontal ecommerce platform and a large chuck of its business comes from enabling other entrepreneurs & business entities on ecommerce space via BuildaBazaar.com.

In 2016, Infibeam became the first Indian ecommerce company to list on stock exchanges.