Wirecard Stocks Slump Over India Report Fears, Analysts Say Sell

German payments company Wirecard’s shares dropped after an Indian business became a key issue in the company’s continuing problems, following a series of articles in the Financial Times alleging fraud in Asia.

Bloomberg reported the company’s shares lost 10 percent in value, which is the biggest intraday decline since Feb. 8.

The company is now involved in a lawsuit with some ex-minority shareholders from an Indian business. The shareholders say they were cheated out of money before Wirecard bought the company in 2015.

That same Indian company is currently being investigated by officials in Singapore over allegations of document doctoring and money laundering.

“Given the various developments since the beginning of the year, our view has turned even more cautious as we believe the market is now mis-pricing the risks associated with a prolonged period of uncertainty,” Citi analyst Josh Levin wrote in a note to his clients. He lowered his rating from neutral to sell.

A spokesperson for Wirecard told the news outlet the Indian allegations aren’t new and have been shown to be untrustworthy based on numerous external audits.

The drop in shares is an opportunity for some equity option traders, as put options with strikes between 115 euros and 105 euros were going to become worthless on Friday (March 15). Wirecard closed  at 115.10 euros on Xetra on Thursday. With some shares trading near 105 euros in Frankfurt, those particular options are now in the money.

After the FT articles were published, Shares in Wirecard fell as much as 25 percent, and closed down 13.4 percent on Jan. 30, the stock’s largest intraday decline in nearly three years. The next day, the shares fell 0.3 percent. As a result, Wirecard CEO Markus Braun lost $221 million of his wealth.

In a statement published on the company’s website, Wirecard said the reports were “inaccurate, misleading and defamatory,” adding that it “takes all compliance and regulatory obligations extremely seriously.” A spokeswoman also said the company welcomed the investigation.