Sebi watching Infosys shares keenly after investors take `34,000 cr hit

New Delhi
Markets regulator Sebi on Tuesday said it is keeping a close tab on the share price movement of IT major Infosys, which saw its first non-promoter CEO Vishal Sikka quitting last week amid differences with its founders.
Shares of Infosys plunged by nearly 10% on Friday wiping out Rs 22,519 crore from its market valuation, after Sikka's resignation. It fell further by over 5% on Monday despite buyback announcement by the company.
Infosys' Rs. 13,000-crore share buyback announced on Saturday failed to cheer investors amid uncertainty around the appointment of a new CEO. The country's second largest software services firm on Saturday announced that its board approved a share buyback offer of up to Rs 13,000 crore.
This sharp fall in Infosys share prices wiped out Rs. 34,000 crore of investors' wealth in just two days. "We are keeping a watch on Infosys share prices," Sebi Chairman Ajay Tyagi said.
"This is a proactive step that SEBI has taken. Usually when high volatility is witnessed in certain stocks, this is done. As of now it appears to be a routine investigation. This can be termed as SEBI's routine surveillance mechanism. SEBI will definitely monitor the case in US against Infosys' managers. "We will wait and watch before taking the next step," a source in SEBI said.
With this, Infosys is no longer on the list of top 10 most valued companies on the BSE and the NSE.
At close of trade on Tuesday, the market capitalisation (m-cap) of Infosys stood at Rs 2,01,478.46 crore on the BSE. With this, the company now ranks 11 on the m-cap chart of BSE listed companies.
On the NSE, the company's market valuation stood at Rs 2,01,074.54 crore.
On Tuesday, however, Infosys shares showed a mild recovery and closed 0.41% higher at Rs.877.15 on BSE.
In a damage control mode, Infosys Co-Chairman Ravi Venkatesan on Tuesday met Finance Minister Arun Jaitley and assured him that the company management will ensure high standards of corporate governance.
Following Sikkas resignation, the COO of Infosys, U B Pravin Rao was appointed the Interim- Managing Director and Chief Executive Officer,
"This wont always be easy in the days ahead. Not with the intense attention on us. This can be unsettling. But only if we let it. And that we must not," Rao said.
Pointing out that this was not the first time Infosys has been up against a tough challenge -- be it rough economic conditions, near-impossible projects or leadership exits -- he said, "We have seen it all. And there hast been a single occasion not even one from which we did not emerge stronger, wiser and most importantly still together as one team Infosys."
"We can do it again and we will. Helping each other, when it is needed, to stay focused on what matters - our commitments, our clients, our vision of who we really are," he added.