A rumor is dangerous, but if a rumor is spread by WhatsApp and digital media, it can be even more dangerous. Infibeam’s stock crashed 71% yesterday and all thanks to a viral WhatsApp message. The stock price of this e-commerce company had begun the day trading at Rs. 180 and came down to Rs. 100 within the first 15 minutes of trade. The company lost about Rs. 1,600 crore of its market capitalization on Friday.
WhatsApp message to blame
If we believe reports on social media, this dramatic fall was caused by a single WhatsApp message which circulated among traders and raised concerns about company’s accounting practices. The WhatsApp message conveyed that Infibeam had given Rs. 1.35 billion interest-free and unsecured loans to its units. Bloomberg reported that the message was sent a few months ago by an Equirus Capital analyst but appeared to resurface yesterday.
Indian stock market is facing a tough time, just last Friday, Dewan Housing and Indiabulls had seen their stock prices fall by as much as 50%. Yes Bank’s stock has decreased 50% after its CEO Rana Kapoor was asked to step aside by the RBI.
Infibeam’s statement
Infibeam has clarified to exchanges after the fall, saying there was no pending information or announcement that may impact its share price.
“The company has always provided timely information sought by the stock exchanges. There is no pending information or announcement from the company which may have a bearing on the price behaviour of the scrip,”
Infibeam said in a statement.
E-commerce getting negative impact
Infibeam’s fall will surely get the attention of people who are following Indian E-commerce startups carefully. This is yet another example which shows that e-commerce business is still experiencing loss even after seeing a boom in the digital market due to Jio.
Also Read: Why Most E-Commerce Startups In India Are In Loss
Problems for WhatsApp
This incident can raise WhatsApp’s troubles in India because the government has warned the Facebook-owned company to let the authorities track the source of messages. The IT authority is planning to send a notice for the third time after July due to the hoaxes caused by WhatsApp.
Also Read: Government To Ban WhatsApp In India If It Doesn’t Find A Way To Trace Fake News & Hoaxes
Meanwhile, WhatsApp has hired a grievance officer for India and also looking for a legal head in the country to help with regulatory and security matters. The company is even looking for a country head and a policy head in India.
