After the news of VG Siddhartha, founder of Coffee Day Enterprises and son-in-law of BJP leader SM Krishna, who is missing in Mangaluru, the stock of the main coffee chain fell more than 20% at Monday's opening. Siddhartha is president and CEO of Coffee Day Enterprises.
Even when the research efforts are underway, Coffee Day Enterprises shares were trading at Rs 153.40 at 9:38.
In a regulatory document, the company informed the stock exchanges that Siddhartha had disappeared.
"It is to inform you that Mr. VG Siddhartha, President, and CEO of Coffee Day Enterprises Limited, has not been available since last night. We take the help of the relevant authorities. The company is professionally managed and managed by a competent management team, that will ensure business continuity, "wrote the company secretary.
V G Siddhartha, son-in-law of the BJP leader and former Karnataka CM SM Krishna has been missing since Monday. The police opened an investigation into his disappearance.
Siddhartha got out of his car near a bridge over the Nethravathi River in Mangaluru. His driver panicked when he did not return in an hour and informed the family. Dakshina Kannada police have been searching for Siddhartha since last night.
On Monday, a letter allegedly written by Siddhartha to the board of directors revealed that he blamed himself for failing as an entrepreneur and failed to create the right profitable business model despite his best efforts. Although the authenticity of the letter has not yet been verified, it indicates that it was under enormous pressure from the lenders.
The first CCD store was opened in 1996 and since then the famous coffee chain has 1,750 stores in India and 60,000 vending machines. Outside of India, it is present in Austria, the Czech Republic, Malaysia, Nepal, and Egypt.
As of March 31, 2019, Coffee Day Enterprises total debt amounted to Rs 6,547 million, or almost 2.5 times the net value of Rs 2,529 million.
In addition to the coffee retail trade, the Coffee Day group specializes in logistics, technology parks (SEZ and STP schemes), financial services and investments in technology and software companies.
The first signs that VG Siddhartha desperately sought to reduce his debt began wanting to sell his stake in Mindtree. Siddhartha was one of Mindtree's first investors and owned 20.42% of the capital. Reports at that time suggested that he was trying to sell this stake to pay 300 rupees to the tax authorities.
In March, Siddhartha collected around Rs 3,200 million-selling its 20.32% stake in Larsen and Toubro Ltd (L&T), and two CCD affiliates (Coffee Day Enterprises Ltd and Coffee Day Trading Ltd) in the services company of Mindtree Software Ltd.
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After that, the media announced that Coffee Day was in talks to sell a substantial stake in the beverage giant Coca Cola and was considering a valuation of Rs 8,000 to 10,000 million for the sale of the stake.
In September 2017, the income tax department conducted a search and seizure operation at 25 CCD sites and group companies in Karnataka, Mumbai, and Chennai. The I-T Department stated that Siddhartha had hidden an income exceeding Rs 650 million. Officials investigated a series of violations of several laws and reported that they found numerous evidence of hidden income.
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