Coforge Shares Plummet Following Chairman's Sudden Resignation
Coforge Faces Turbulence After Leadership Change
File image of Coforge chairman O.P. Bhatt(Photo: IANS)
New Delhi, Sep 9: Shares of Coforge, an IT services firm, experienced a significant drop of over 8% during early trading on Wednesday. This decline followed the immediate resignation of O.P. Bhatt, the chairman and non-executive independent director, due to issues uncovered in an internal audit regarding the board evaluation process.
The stock fell by as much as 8.67%, equating to a loss of Rs 169 per share, reaching an intraday low of Rs 1,780.10 by 9:50 AM on the BSE.
According to a filing with the exchange, the board acknowledged Bhatt's resignation, which also resulted in his removal from all committee memberships.
In his resignation email, Bhatt expressed that he had acted in good faith and believed that remaining on the board amidst ongoing disagreements regarding his actions in the evaluation process would hinder effective governance.
He stated, "The matters referred to above are the material reasons for my resignation, and I confirm that there are no other material reasons for my resignation," as disclosed by the IT company.
The internal audit, part of the Q2 FY26 audit plan, assessed the board evaluation process under the chairman's guidance and the subsequent Board Evaluation Report presented to the board, according to Coforge.
This review raised concerns about how the report was handled and presented, noting that some critical information related to the report and the chairman's performance had not been fully disclosed to the board at the time of presentation.
Following this, the board expressed its concerns and requested an explanation from Bhatt.
While Bhatt provided a response, the board was still deliberating on his explanation and had not reached a final decision regarding the issues raised.
In the interim, the board has appointed Vivek Sharma, a non-executive independent director, as the interim chairman until January 31, 2027.
Additionally, Bhatt serves as an independent director at Wockhardt Ltd, where he is involved in the audit, stakeholders' relationship, and capital raising committees.