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Eros Intl shares all-time low after short-seller report on parent firm

Stock fell by 10 per cent on Monday post-allegations of financial irregularities

BS Reporter & Bloomberg  |  Mumbai 

Eros International
Eros International

The share price of ended 10 per cent lower on Monday after a US-based short seller alleged accounting irregularities. Last week, the shares of Eros were battered after rating firm CARE downgraded its creditworthiness to “default”, citing delays in and cash flow issues.

Even as the company was battling to assuage concerns the US-based Hindenburg Research in a note on Friday alleged that much of the receivables that the company had claimed might not be existing. Further, the note accused its promoters of engaging in highly irregular related party transactions which appear designed to hide receivables.

The company's management has denied the allegations. “There’s nothing new in these allegations,” said Eros Chairman Kishore Lulla. “Shorts are again manipulating the stock, and our lawyers will decide the further course of action,” he added.

PLC on Sunday announced a share buyback programme of $20 million in The company is listed on the

Hindenburg's note has alleged that company’s auditors have failed to apply even basic scrutiny to Eros’ financials, and said the price of the company’s stock will end up worthless unless there is some bailout.

Meanwhile, Eros has maintained its forecast that paid users of its online-streaming unit Eros Now will reach 50 milion in about three years. Further, the company sees average revenue per user in India to rise to as much as $10 in three years from about $5 currently; about 90 per cent of Eros Now’s paid subscribers are in India.

First Published: Mon, June 10 2019. 23:25 IST
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