Court stay extends Karvy woes

HYDERABAD: The Andhra Pradesh High Court’s stay order on the Securities and Exchange Board of India (Sebi) directive asking customers to shift their accounts from Karvy DP within 15 days to other depository participants (DPs) seems to have done little to help the beleaguered company.

Though it may not appear to be a huge number in the light of the 7 lakh DP accounts that Karvy DP held, sources said as of Thursday it had lost 4,000 accounts since the Sebi directive on April 28.

Karvy chairman C Parthasarathy, who had parked himself in Mumbai since early this week in the hope of getting an audience with Sebi officials, had to return a disappointed man to Hyderabad after an appointment scheduled for Thursday was postponed indefinitely at the last moment. He was not available for comment.

Contacted, Sebi also refused to comment on this. The market regulator said it was yet to receive a copy of the high court order.

Karvy DP has been losing business not just over the past seven days but actually right from the beginning of January when the Sebi passed an administrative order asking it not to open new accounts, market sources said.

Karvy DP is said to be the third-largest DP in the country and nominally speaking, it may have lost an opportunity to open nearly 1.5 new accounts since the beginning of the year.

“Considering the current boom conditions in the market with the spate of IPOs and market activity, the company could have garnered 30,000 to 40,000 new accounts every month,” the sources added.