Almondz Global’s merchant banker certificate suspended by SEBI

SEBI barred Almondz Global Securities for failing to exercise due diligence and for violating norms in the IPO of Bharatiya Global Infomedia 

Market regulator Securities and Exchange Board of India (SEBI) suspended merchant banker registration certificate of Almond Global Securities (Almondz) for six months for violating norms in the initial public offering (IPO) of Bhartiya Global Infomedia Ltd (BGIL).

SEBI in its investigation found that, BGIL had used the IPO proceeds in a substantially different manner and purpose from what it disclosed in the draft prospectus. BGIL also made incorrect and misleading disclosures in the prospectus.  SEBI said, “As a lead manager of this IPO Almondz has failed to exercise the required due diligence.” SEBI held Almondz equally responsible in the fraud committed by BGIL and its officials.

SEBI found Almondz guilty for failure to exercise due-diligence in respect of wrong, false and misleading disclosures and also in respect of non-disclosure of ICD raised by BGIL.
However, with regard to the third allegation of failure to carry out independent valuation, Almondz had been given ‘benefit of doubt’ by SEBI.

SEBI said BGIL and Almondz as its book runner lead manager (BRLM) of the issue has issued share at Rs82 per share, on the day of listing BGIL share prices opens at Rs81.9 and closed to Rs29.90 at BSE. Hence SEBI has decided to investigate its IPO proceedings.

SEBI in its order, barred Almondz from taking up any new assignment or involvement in any new issue of capital including IPO, follow-on issue in the securities market for a further period of six months from the date of the order. Almondz has been further directed that during this period of six months, it shall not take up any assignment or involvement in buy-back of securities, open offers under the SEBI and delisting of securities.

Read more stories on Almondz Global,

IPO Crackdown-1: Bharatiya Global Infomedia

SEBI to reform IPO norms to check volatility on listing day

SEBI action on merchant bankers, a bit too late?


What about Mistakes & Crimes of Juveniles?
If a boy falls off a bus while showing bravado, should the bus company be held responsible?

These days juveniles are very much in the news for committing adult crimes. Those under 18 years of age are considered as not fully mature and treated with kid-gloves, rather than being tried as adults.
The contention is that they are not totally aware of the consequences of their actions. It may or may not be true and that discussion is best left for another day. Today, we argue about the fine balance between knowledge, safety, bravado and care.
A boy of 11 years was travelling by a public transport bus in Mumbai. He was standing near the door. As is common in heavy AND crazy traffic, the bus driver suddenly braked to a halt. The boy lost his grip and fell out of the bus. Tragically, he landed on the road and was run over by another vehicle. He died.
Now, you be the judge.
Consider the facts. A boy of 11, not a child. Travelling alone or without a proper chaperone. Aware of the dangers of standing near the door of a moving bus or not? Was he just showing-off, as most youngsters are prone to do? Was he not paying attention to the possible danger? 
What about the other driver? The one under whose car the boy was crushed to death. In Mumbai’s traffic, where everyone is driving bumper-to-bumper, is it not impossible to avoid being involved in such a tragedy? And who should bear the blame? The boy? His parents? The bus driver? The other driver? Or the person who caused the dangerous situation that the bus driver was forced to apply brakes on an emergency basis? The bus company?
The court held against BEST, the bus company. This is where the question of negligence and the duty of care dovetail in law. Negligence is defined as wilful disregard in the course of duty. It involves the knowledge that something can go wrong if proper care is not taken. 
Invariably, in such cases, the law has a fall-back position. It takes refuge behind the argument of what a ‘prudent’ man would do in similar circumstances. Common sense being an uncommon commodity, prudence is the catch-all phrase. And then the courts decide on who had the greater responsibility.
A child’s life is lost in terrible circumstances. It happens everyday. In our young days, our Dad would not allow us to travel on trains on what was called the ‘foot-board’, for fear that our school bags would get caught in the railway track equipment, mainly poles. Here, a bus would be relatively safe. But did the boy’s parents caution him against standing near the door?
The other driver’s defence would be that he cannot be held responsible if a human being lands in front of his car, literally from thin air. What about BEST, the bus company?
When a company, or even an individual, provides a service, he has a duty of care. The conductor should ensure that the child is away from the door of a moving bus. Many will argue that, in this day and age, it is an impossibility. But then, we go back to our worn-out phrase: ‘If there is a malady, there has to be a remedy’.
Obviously, the traffic accident tribunal pinned the blame on the Bombay Municipal Corporation (as it was known in 1985), since BEST is owned by them. The Corporation was the respondent in the matter, not the driver. 
It was a clever move by the deceased boy’s advocate and is one more instance of not only finding the right forum but also the correct entity to file the suit against, for both, retribution and costs.
Bapoo Malcolm is a practising lawyer in Mumbai. Please email your comments to [email protected] or [email protected]


LIC sold 0.46% stake in Infosys in March quarter

While FIIs are increasing their shareholding in Infosys, domestic institutional investors including LIC, are reducing their stake in the country's second largest IT company

State-run Life Insurance Corporation of India (LIC) sold 0.46% of its stake in Infosys Ltd for about Rs850 crore to cut its shareholding to 3.25% in the IT company during the March quarter. Taking into account the current market value of Infosys shares, the 0.4% decline in LIC's holding in the company would be worth overt Rs850 crore.


LIC, the country's largest insurer is also the biggest institutional investor in Indian markets. During the December 2013 quarter, it held 3.71% stake in Infosys.


As per data from BSE, the insurer has been reducing its stake from the IT company. As on June 2012, LIC had 6.72% stake in Infosys which was reduced by 3.47% to 3.25% as on March 2014.


LIC appears to have sold shares at a time when foreign institutional investors (FII) were increasing their stake in Infosys. FIIs hiked their stake in Infosys to 42.10% in the January-March quarter from 40.65% in the preceding three months.


However, domestic institutional investors (DII) reduced their exposure in Infosys to 13.66% in January-March quarter of 2014 from 15.35% in the preceding quarter.


Infosys, which is scheduled to report its fourth quarter earnings tomorrow, is expecting a sluggish growth in revenue during the quarter.


Infosys co-founder NR Narayana Murthy was brought back to head the IT major in June last year, following quarters of laggard performance.


Meanwhile, the company shares have underperformed the broader market by declining nearly 6% compared to 5.7% surge in the BSE's benchmark Sensex during the March quarter.


Infosys closed Friday marginally higher at Rs3,235.85 on the BSE, while the 30-share Sensex ended the day marginally down at 22,628.


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