Delhi HC stays cheating case proceedings against Hero MotoCorp officials
The Delhi High Court today stayed proceedings against some Hero MotoCorp officials in an alleged cheating case, and posted the matter to be heard next on December 6, 2023.
The development comes after the Delhi police this week filed an FIR (first information report) against some Hero MotoCorp officials on the charges of "forgery, cheating and falsifying the books of accounts" valued at ₹5.9 cr.
The case was reportedly filed after a complaint by Delhi-based logistics firm, Brains Logistics, against the two-wheeler company.
In a statement to the exchanges, Hero MotoCorp said: "This is with reference to the recent news item regarding an FIR against the company/ officials. This is to inform that it is an old matter pertaining to the year 2009-10 with a disgruntled service provider, Brains Logistics Pvt. Ltd. (Promoter - Roop Darshan Pandey). It may also be noted that while the complainant has mentioned company officials in the complaint, however, no official has been named in the FIR. In 2013, Hero MotoCorp also registered an FIR against them and the matter is ongoing before the competent court."
In another case, Pawan Munjal, executive chairman of Hero MotoCorp, has also been accused of claiming a tax credit of ₹55.5 lakh by generating fake monthly bills between 2009 and 2010. Apart from Munjal, this case has also been filed against Hero's three other officials.
The ED had three months back also seized assets worth ₹25 crore, including gold, jewellery, foreign currency and incriminating documents from the residence of the senior officials of the company, including Munjal, in a case pertaining to alleged money laundering.
In August 2023, the Centre’s Directorate of Revenue Intelligence (DRI) arrested a close aide of Munjal in relation to alleged money laundering and the possession of undeclared foreign currency.
The ministry of corporate affairs in September 2023 had also launched a probe against Hero MotoCorp for the alleged lapses in corporate governance as it was accused of floating "shell firms".
As per the department, an expenditure of over ₹800 crore made by Hero MotoCorp was booked in the "guise" of buying services from a specific event management entity, which allegedly siphoned off the money.
Hero’s shares closed 0.47% lower at ₹3086.05 today, in line with the broader market – BSE Sensex was down 0.097% and Nifty 50 at -0.14%.
Currently, Hero’s m-cap is ₹61,680.57 crore, with 14,000 shares exchanging hands on the counter against the two-week average of 11,000 shares.
Hero’s share is trading 4.3% lower than the 52-week high of ₹3,242.85 touched on August 1, 2023. It’s trading 27.1% higher than the 52-week low of ₹2,246.75 hit on March 28 this year.
Hero MotoCorp, which claims to be the world’s largest maker of motorcycles and scooters, sold 536,499 units in September 2023, up 3% YoY over 519,980 units sold in the year-ago period.
Hero's consolidated revenue for the April-June quarter stood at ₹8,851 crore, a growth of 5% YoY and EBITDA margin was 13.8%, up 250 bps. The company's profit was ₹701 crore, a growth of 20% YoY.