Karvy Corporate

Karvy Group is a financial services company in India. It was involved in financial services like equity, commodities trading, depository and wealth services and distribution of other financial products. It has its headquarters in Hyderabad.^[1] It also had branch offices outside India in Bahrain, Dubai, Malaysia, Philippines and the United States.

Karvy Group

Company type	Private
Industry	Financial services
Founded	1983; 41 years ago (1983)
Headquarters	Hyderabad, Telangana , India
Area served	India
Key people	C. Parthasarathy (Chairman and Managing Director) M. Yugandhar (Managing Director) M. S. Ramakrishna (Director)
Website	www.karvy.com[dead link‍] www.karvyinvestmentbanking.com

Scams perpetrated during 2019 involving Karvy Stock Broking Limited (KSBL), a group company led to the filing of criminal cases against the Chairman and others. This led to the banning of KSBL by the regulator.^[2]

History

Karvy Group was established in the year 1983 ^[1] and was headed by C. Parthasarathy as Chairman.^[3][4] The group at one time had more than 30,000 employees, spanning 900 offices in about 400 cities and towns. In the mid-1990s, Karvy forayed into stockbroking and advisory businesses.^[5][6] Later, in the early 2000s, Karvy Corporate ventured into commodity trading. With the introduction of currency trading, Karvy Corporate was also in the business of Forex trading.^{[citation needed]}

Business

Karvy Group provided financial services like finance, insurance, broking, investment banking, loans for individuals and businesses. Karvy started its ecommerce business on Karvyclick.com^[7] to enable small and medium enterprises to go online for selling their products in various eCommerce platforms.^[8]

Karvy Data Management Services, a subsidiary of Karvy Group, has acquired the call center business of Media Matrix Worldwide^[9] Ltd for Rs 30 crore in 2017.

Karvy Group has following nineteen subsidiary companies under it.^[10]

• Karvy Stock Broking Ltd. (KSBL)- Equity Broking, Depository Participant, Distribution of Financial Products (Mutual Funds, FD and Bonds), Wealth Management Services, Currency Derivatives, Portfolio Management Services
• Karvy Comtrade Ltd. - Commodities Broking
• Karvy Capital Ltd. - NBFC & Portfolio Manager
• Karvy Investment Advisory Services Ltd. - Investment Advisory Services
• Karvy Holdings Ltd. - Core Investment Company
• Karvy Middle East LLC - Wealth Management Products for NRI’s
• Karvy Realty (India) Ltd. - Realty Services
• Karvy Financial Services Ltd. - Non Banking Financial Services
• Karvy Insurance Repository Ltd. - Insurance Repository services
• Karvy Forex & Currencies Private Ltd. - Currency and forex services
• Karvy Consultants Ltd. - Consultancy and Advisory Services, Publications
• Karvy Data Management Services Ltd. - Data Management Services
• Karvy Investor Services Ltd. - Merchant Banking and Corporate Finance
• Karvy Insights Ltd. - Market Research
• Karvy Analytics Ltd. - Analytics
• Karvy Solar Power Ltd. - Power Generation
• Karvy Global Services Ltd. - Business Process Outsourcing
• Karvy Global Services Inc, USA - Business Process Outsourcing
• Karvy Inc, USA

Divested companies

• Karvy FinTech (name changed to KFinTech after divesting),^[11] Incorporated in 1978, and started operation in 1984 as a Fintech company for providing digital mutual fund services.

Criminal cases involving Karvy group companies

In November 2019, Securities and Exchange Board of India barred Karvy Stock Broking Limited (KSBL) from purchasing shares in delivery and also accepting new clients pending a forensic audit. SEBI found out that Karvy had defaulted Rs. 2000 crore of investor funds by pledging the securities holdings of its customers. The action was based on a detailed report by National Stock Exchange. The company had sold excess securities (not available in their DP account) worth Rs 485 crore through nine related clients till 31 May 2019. They further transferred excess securities worth Rs 162 crore to six of the nine related clients until 31 May 2019. Later, it tried to repurchase the securities worth 228.07 crores to cover up for the shortfall between June - September 2019. An amount of 1096 crore was transferred to its group concern Karvy Realty Private Limited during the period of April 2016 - October 2019. ^[12][13]

In related investigation, Enforcement Directorate arrested C. Parthasarathy on 27 Jan 2022. ^[14] They were released on bail subsequently.

On 25 November 2022, a fresh criminal case was registered against C. Parthasarathy, the Chairman of Karvy Reality (India) Private Limited for cheating few investors from Kolkata and Kerala by engaging to sell plots in 2019, in an old real estate venture of 2009.^[15]

References

1. "Karvy Stock Broking Ltd Stock Recommendations | Karvy Stock Broking Ltd Short and Long Term Stock Recommendation". www.dsij.in. Retrieved 17 April 2017.
2. "Karvy investor faces Sebi ban". Economic Times. 29 March 2024.
3. Mr C. Parthasarathy. "The Hindu Business Line : 'We want to be No. 1 in merchant banking'". www.thehindubusinessline.com. Retrieved 17 April 2017.
4. "C. Parthasarathy: Executive Profile & Biography - Bloomberg". www.bloomberg.com. Retrieved 17 April 2017.
5. "Karvy Brokerage & Karvy Demat Account Reviews 2017". www.chittorgarh.com. Retrieved 17 April 2017.
6. "BSE Ltd-Member Database". www.bseindia.com. Retrieved 17 April 2017.
7. Bailay, Rasul. "Karvy Click". The Economic Times.
8. Sagar Kumar, Richard moro. "Arincen network trading". Retrieved 22 April 2023.
9. "Media Matrix Worldwide".
10. "Our Companies". Karvy. Archived from the original on 19 December 2022.
11. "General Atlantic rechristens Karvy Fintech to KfinTech". The HIndu Businessline. 2 December 2019. Retrieved 27 December 2022.
12. "Sebi bans Karvy for Rs 2,000 crore client defaults". The Economic Times. 23 November 2019. Retrieved 13 April 2020.
13. Muth, Sagar Kumar. "Karvy pledged clients' securities to raise funds: Registrar of Companies | Hyderabad News - Times of India". The Times of India.
14. "ED arrests Karvy Group Chairman C Parthasarathy in Rs 2,000-crore security scam". moneycontrol. 27 January 2022.
15. "Hyderabad: Karvy Group chairman C Parthasarathy booked for selling plots of 2009 sold-out venture". Times of India. 25 November 2022. Retrieved 27 December 2022.