Shares of HDFC Bank recouped some of previous day losses that was triggered over worries of class-suit action proceedings to be initiated in the US. Investors seem to have digested the news and are confident of the privates sector lender weather the consequences effectively.
US-based global investor rights law company Rosen Law Firm announced a lawsuit on behalf of shareholders of HDFC Bank following allegations against the bank of issuing “materially misleading business information” to investors.
The development comes days after it was reported on July 13 that HDFC Bank had conducted an investigation into the “improper lending practices and conflicts of interests” in its vehicle-financing arm.
According to the law firm, HDFC Bank reported its financial results for the first quarter of the fiscal year 2021, missing analyst estimates with respect to net profit and reporting a deterioration in its asset quality.
It has asked investors of HDFC Bank to register on the law firms website and join the securities action.
The law firm has sought information from all those HDFC bank shareholders who are looking to recover their losses in the bank’s securities.
According to media report, credit information bureau Experian Plc’s Indian unit had informed the Reserve Bank of India (RBI) that “HDFC Bank has been late in providing details of its loans, including the repayment status of its millions of retail borrowers.
Last year the law firm had prepared a class action lawsuit against Infosys after an anonymous whistleblower group accused the Infosys management of taking “unethical” steps to boost short-term revenue and profits.
Another litigation firm Schall Law Firm is also preparing for a class action suit against HDFC Bank.
Meanwhile, on August 4, RBI cleared name of Sashidhar Jagdishan as the next CEO of the private lender. Jagdishan will succeed Aditya Puri who will retire from the top post on October 26.
HDFC Bank share price has fallen 7% in one year and lost 19.17% since the beginning of this year.
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