Hero MotoCorp suffers significant share price decline due to ED raids
Hero MotoCorp, India’s leading two-wheeler manufacturer, experienced a significant decline in its share price, plummeting by more than 4 per cent on Tuesday (Aug 1). The drop was triggered by the Enforcement Directorate’s (ED) raids at the residence of the company’s chairman, Pawan Munjal.
This investigative action was part of a broader money laundering probe, as reported by news agency PTI.
The news of the ED’s actions had an immediate impact on Hero MotoCorp’s shares, causing them to fall by 4.4 per cent to Rs 3,063 around 1:00 pm. The raids were conducted at various locations in Delhi and neighbouring Gurugram, under the provisions of the Prevention of Money Laundering Act (PMLA).
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The investigation was initiated following a complaint from the Directorate of Revenue Intelligence (DRI) against an individual allegedly having close ties to Pawan Munjal. This individual was previously under investigation for carrying undeclared foreign currency.
It’s worth noting that in the past, Pawan Munjal himself was arrested by the DRI at the Delhi airport with foreign currency amounting to Rs 81 lakh. Furthermore, in March 2022, the Income Tax Department conducted search operations at 25 premises linked to Hero MotoCorp as part of a tax evasion investigation against the company.
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Pawan Munjal has been instrumental in guiding Hero MotoCorp’s global expansion since the company’s separation from Honda in 2011.
He also holds executive positions in two industry bodies, the Confederation of Indian Industry (CII) and the Society of Indian Automobile Manufacturers (SIAM). His involvement in these organisations reflects his prominent role within the Indian automotive sector.
As this is a dynamic situation, it’s crucial to keep an eye on reliable news sources for updates on the ongoing investigation and its potential implications for Hero MotoCorp and its chairman.
