New Delhi, September 09: Coforge’s shares fell more than 4% in early morning trades on Wednesday after the abrupt resignation of its Chairman Om Prakash Bhatt. This comes after an internal audit revealed that he had withheld information in the audit evaluation process, and resigned even though the board hadn’t made a final decision in the matter.
This development has concerned investors, raising questions about corporate governance at the IT services firm. In regulatory filings, the company said the resignation was linked to ‘material reasons’ related to the evaluation of board members, a critical process that ensures transparency and accountability for listed entities.
Market analysts say that the reaction is not just a response to the loss of a veteran leader, as mr Bhatt was the former Chairman of the State Bank of India, but shows how internal oversight was missing in the company. In a sector where corporate governance standards are heavily scrutinzed by institutional investors, any friction between the chairmain and the audit committee evaluating the board can lead to a valuation de rating.
Mr Om Prakash Bhatt had been at the forefront of steering the company, even as it works to integrate its largest acquisition to date, where it paid almost $2.35 billion for US based Encora. The company has delivered strong financial results for Q1 FY27, even through it remains saddled with debt and will not have it easy to become India’s seventh largest IT firm post the acquisition.
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