Naresh Goyal, the founder of Jet Airways, along with five others, have been charged by the Enforcement Directorate (ED) in an alleged fraud case involving ₹538 crore at Canara Bank. The charges come in the wake of a May 3 FIR involving unknown public servants. The accused parties include Anita Goyal, former executive Gaurang Ananda Shetty, Jet Airways (India) Limited (JIL), Jet Lite Limited (JLL), and four other entities.
The ED's investigation revealed a complex network of financial transactions. It was found that JIL had an outstanding loan of ₹6,000 crore from a consortium of 10 banks for operations conducted between 2011-19. A forensic audit exposed that ₹1,152 crore were misdirected as consultancy fees and another ₹2,547.83 crore were transferred to JLL and written off from JIL's books. In addition to this, JIL contravened the GSA Agreement by paying ₹403.27 crore and using funds for Goyal's daughter's firm.
Canara Bank alleges that it extended a loan amounting to ₹848.86 crore to Jet Airways, with ₹538.62 crore still outstanding. Investigations have further unveiled Goyal's international trusts which were used to divert money for buying and selling high-value properties in Mumbai.
Goyal is currently held at Arthur Road jail under the Prevention of Money Laundering Act (PMLA). He is implicated in a Central Bureau of Investigation (CBI) FIR for misusing bank loans. The investigations also revealed that Goyal funded his daughter's production company, paid residential staff, and purchased immovable assets like furniture through an intricate web of Indian companies.
InvestingPro Insights
In light of the recent allegations against Jet Airways and its founder Naresh Goyal, it's crucial to consider the company's financial standing and performance. According to InvestingPro, Jet Airways has been struggling with profitability over the last twelve months. In addition, the company's stock price has performed poorly over the last decade, with significant falls over the last five years. This is reflected in the real-time data, which shows a negative price to earnings ratio of -1.00, indicating that the company is not generating profits relative to its share price.
Moreover, Jet Airways's revenue growth has been negative, with a decrease of -2.54% over the last twelve months as of Q2 2023. The company's gross profit margin, however, stands at 22.41%, which is an impressive figure given the current circumstances.
It's worth noting that these insights are just a fraction of the comprehensive data and tips available from InvestingPro, which currently lists numerous additional metrics and tips for Jet Airways and other companies.
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