REASONS FOR SUSPENSION OF SHARE TRADING OF BHARAT GLOBAL DEVELOPERS LTD
SEBI on 23-12-2024 suspended trading in shares of Bharat Global Developers Ltd., as it had manipulated their stock price through accounting frauds and fake disclosures.
SEBI alleged that falsely claimed to have won large orders from corporates such as Reliance Industries Ltd., Tata Group, etc.
Shares of the Bharat Global company surged over 10,000 per cent in the 12-month period ending November as it announced forays into market-fancied sectors like defense, aerospace and agro technology, and then followed it up with a series of disclosures to stock exchanges about “high-value orders” from shelter corporates.
SEBI alleged that Bharat Global had allotted about 100 million shares to 41 investors through preferential share offerings in April and August at significant discount to market price.
SEBI alleged that alleged that the disclosure of the orders by company were “false and misleading” and were timed to “benefit” investors of the share offerings.
SEBI found that following such disclosures, 13 of the 41 investors in the preferential share offering offloaded their holdings for 2.7 billion rupees ($31.7 million) after the lock-in period ended on Oct. 31.
Subsequently, the number of public share owners rose four-fold to over 40,000, indicating that many unsuspecting investors bought the stock.
“Material disclosures of the company and the actions of the preferential allottees appear to have been planned towards sale of shares to make huge profits.”
The funny part is that Bharat Global reported negligible revenues and profits prior to the fiscal year ending March 2024, and had its shares suspended for trading until November 2023 over non-payment of listing fee to the BSE.
SEBIs ACTION ON OTHER DECEPTIVE COMPANIES
· SEBII earlier cancelled the initial public offering of Trafiksol ITS Technologies after a probe revealed a key vendor of the company to be a shell entity.
· BSE on Monday deferred the bidding for Solar91 Cleantech Ltd.’s initial public offering pending further examination of “certain queries raised by complainants in media.”
· SEBI has consequently barred several investors in the preferential offerings from accessing the capital markets, while also impounding the “unlawful gains” made by the investors.
Courtesy : Business Standard
R V Seckar , FCS ,LLB
79047 19295
