Analysts have expressed concerns about these related party loans and the company’s late disclosure about it. “Loans granted are part of cash management (and) are short-term in nature and are pending long-term deployments based on business needs,” Srinivas Palakodeti, CFO of HGS.
Ajay Sharma, an analyst, has repeatedly asked management when appealing the logic behind such related party loans. “No, I’m not saying that. So I can confirm that everything has been paid back and redeployed as needed after taking something that is required for the use of the business, ”Palakodeti said in responding to Sharma on whether any sums of money are currently there. overdue for the related party.
Shriram Subramanian, founder and CEO of InGovern, a proxy consultancy firm, said it could be a corporate governance issue due to the late disclosure. “It’s not in the ordinary course of business because they haven’t disclosed it in a much more open manner. It appears to be a corporate governance issue,” Subramanian said. Questions about loans when called by analysts were not convincing, he added.