Companies & Sectors
Arshiya International: Ambitious plans, insider trades

The company has been announcing that it has a lot of projects to be launched in the near future. But the trading in its scrip is more interesting than its purported growth plan

Arshiya International Ltd, part of the Arshiya Group, is a listed entity on the Bombay Stock Exchange (BSE) and the National Stock Exchange (NSE). It is an integrated supply chain and logistics infrastructure solutions provider.

On 18th August, Arshiya International announced the launch of its first free trade warehousing zone (FTWZ) in Mumbai. The company also announced plans for huge investments in its various other proposed projects.

The shares of Arshiya International have been volatile today, ahead of the launch of the company's first FTWZ. The stock opened at Rs296 on the BSE and Rs300 on the NSE today. It touched a high of Rs305.80 and a low of Rs291.55 on the BSE. Similarly, the stock touched a high of Rs306 and a low of Rs292 on the NSE.

The stock has also gained over the past three days. On 17 August 2010, the stock closed at Rs282.50 on the BSE. On 18th August it closed at Rs292.95 and today it closed at Rs296.75. The stock price has increased by 5% compared to the close on 17th August.

It appears that there has been a lot of insider trading going on in the company before its major launch announcements, based on Arshiya's disclosures to the NSE and BSE. The media has also been flooded with reports on the company's ambitious growth plans.

Before the 18th August announcement, the company disclosed three main insider trades to the BSE. These three trades were undertaken by V Shivkumar and Sandesh Chonkar, both executive directors of the company.

On the other hand, Ashish Bairagra, independent director, Arshiya International, reduced his shareholding in the company to nil from the earlier 0.085% that he had held. The shares were offloaded through a market sale on 22nd July and were intimated to the company on 26th July 2010.

G Hariharan, group legal counsel and head corporate governance, also increased his shareholding in the company from nil to 0.014% through a market purchase of 8,000 shares on 29th July 2010.

On 30th July 2010, the company informed the BSE that Mr Chonkar had purchased 20,000 shares through market purchase. This allotment was made on 29th July 2010.

On the same date, Mr Shivkumar had acquired 21,000 shares through market purchase. This allotment was made on 29th July. On 16th August, the company disclosed that Mr Chonkar had purchased 2500 equity shares through market purchase. This allotment was made on 13th August.


BSNL can buy equipment from Chinese vendors: Govt

New Delhi: After a temporary bar due to security concerns, the government has lifted ban on state-run telecom firm Bharat Sanchar Nigam Ltd (BSNL) to procure equipment from Chinese vendors, reports PTI.

"In the interest of national security, the government had directed BSNL in May, 2009 that resources should not be procured from the Chinese vendors for deployment in the sensitive regions (especially border states)," minister of state for telecom and IT Sachin Pilot said in a written reply to the Rajya Sabha.

New guidelines have been issued for procuring telecom equipment from foreign vendors in consultation with the ministry of home affairs to address security concerns, Mr Pilot said, adding "accordingly, now BSNL may enter into agreement with foreign vendors for purchase of equipments/ software/ services."

In its last tender for about five million GSM lines, the public sector undertaking (PSU) had invited bids only from three European and American vendors and Chinese companies were totally left out.

BSNL employee unions raised the issue with the Department of Telecom (DoT) last week. They alleged that the ban on BSNL for buying equipment from Chinese vendors was "discriminatory", as private players were allowed the imports from China.

Elaborating on the reasons for "discrimination" against BSNL, Mr Pilot said that participation of foreign companies in strategic sector has bearing on national security. "BSNL being a public sector undertaking, its network has to be relied upon in emergencies," he added.

Earlier, DoT had barred BSNL from deploying Chinese equipment in sensitive regions-Assam, Manipur, Tripura, Sikkim, Nagaland, Arunachal Pradesh, Mizoram, Meghalaya, West Bengal, Gujarat, Rajasthan, Punjab, Jammu and Kashmir, Himachal Pradesh, Uttarakhand and Maharashtra.

Now, with the new guidelines and template of agreement between telecom service providers and equipment vendors in place, BSNL would be able to place the orders with any foreign firm including from China.

Questioning the rationale behind the move, Sanchar Nigam Employees Association had said, "This is absolutely ridiculous for the simple reason that the move is just intended to jeopardise the growth of BSNL.

"How are the security interests of the country protected while allowing private operators to install Chinese GSM equipment and restraining BSNL from doing so?"

BSNL plans to expand network capacity manifold in the coming months in view of growing demand for mobile telephony, especially in the rural areas. Allowing BSNL to buy equipment freely from foreign vendors will help the state-owned firm in taking commercially viable decisions.


How hollow is the Indian Stock Market? - II

The best kept secret about the Indian capital market is that in 20 years of economic liberalisation and market development, we have reduced it to a mere casino

How wide is the public participation in the shining new India's financially successful stock exchanges? Here are some startling facts disclosed by minister of state for finance, Namo Narain Meena, in response to a question (1692) asked by Mohammed Adeeb, a Member of the Rajya Sabha.

On 10th August, the Minister said that trading in the top 10 companies accounted for nearly a quarter (24%) of the cash equity market turnover on the National Stock Exchange (NSE) in the April-June 2010 period. In the derivatives segment (equity futures and options) trading in top 10 companies rose to a massive 38% of all turnover. The NSE is a near-monopoly. It has a market share of 96% (cash and derivatives combined) and has absolutely no competition in the derivatives trading segment. Trading in derivatives is seven times that of the cash segment, accounts for the bulk of its profits and therefore fat salaries of the very few at the top.

The Minister also said in his response that 67% of all transactions in the derivatives markets are by day-traders who square off their transactions on an intraday basis. In the cash segment, only 36% of the transactions lead to delivery, the rest are squared off. The NSE has 1987 securities available for trading in the cash market and 203 stocks trading in the derivatives segment, including four indices.

The data shows that the market has neither depth nor diversity and only a small segment of Indians are involved in the market - that too in the form of speculation by day traders in a few select products including the main index, Nifty, one of the largest traded products. Currently, index futures account for 11% of daily turnover while index options account for a massive 55% of daily turnover. Interestingly, futures and options trading on the 200-odd stocks account for just 34% of its daily derivatives turnover.

Also, contrary to perception, institutional investors do not dominate the market. In fact, 52% of the turnover in the cash market as well as derivatives comes from retail investors, high net worth individuals and corporate investors. This is hardly a market that can hope to support a big disinvestment programme by the government or even the fund-raising plans of large Indian companies. No wonder, retail subscriptions to public issues have dwindled.

In its zeal to add more and more stocks to drum up more and more volume, NSE has added dozens of stocks that have no trading interest and therefore no liquidity in the derivatives segment. Just 106 contracts of India's largest paint company, Asian Paints, were traded on 17th August. Container Corporation, a giant public sector company, does not trade more than 10-12 contracts a day. Recently NSE added a scrip called Samruddhi Cement - the erstwhile cement business of Grasim. On 17th just three contracts of the scrip were traded.




6 years ago

the revelations are really startling. the regulators can really reduce the transaction costs and make non participants more knowledgeable. there are people spreading rumours on stock markets mere out of desperation than on any real grounds. if you make the stock market operations as "professional", with a professional body, the confidence of the people at large might return. this should be done like ICWAI / CA/ DOCTOR/LAW professions.


6 years ago

The article is a eye opener to those who think it as a heaven for money making but the real face is that it is a HELL full of demons,these money sucking DRACULAS have sucked lot of money from retail investors-these facts given in this article are proving that these brokerage houses are biggest players in wiping out retails by driving the markets against retail positions-they monitor ''retail positions''through their special softwares which makes them enable to drive the markets against retails in futures and cash segment-they make scrips to move up when retail participation is negligible-the scrip moves 5-10 times,then they ''make''it to correct to 40% or more-so people try to ''invest'' in this scrip-when retail participation gets fully involved they make it to further get corrected to 30-40%,so people wait to get it to prices they purchased-but that day never comes-bcos this scrip has been ''garlanded''to retail investors's neck-retail has no guts or money power to again move up this scrip to better levels except keep on waiting-
this all drama is performed very intelligently-
my guess has been fully proved by facts in this article-thanks Sucheta madam for such bold and eye opening article-
I am sure this article is ""REAL INVESTORS EDUCATION""

Tony Joe

6 years ago


Nice numbers you have arranged. So, what do you suggest? Ban the market? Also, I was dumbfounded by the logic that even 52% of the cash & derivative markets being controlled by retail investors, HNIs, & corporates, is not enough to ensure retail participation in public issues! What do you suggest? People should gobble up pizzas like SKS that comes with a price tag of 35 P/E? Please don't contradict yourself.



In Reply to Tony Joe 6 years ago

boss, cool down. moneylife has not "arranged" any numbers (i dont know what you mean by that word). Its what the minister has said. these numbers came out because of the question asked. NSe does not give out these numbers. It dodges RTI. Do some homework before ranting in an incoherent manner

Tony Joe

In Reply to rakesh 6 years ago

Hi Rakesh,

What can I do if a simple contradiction in the story that I pointed out seems 'incoherent' to you? I mentioned the numbers as 'arranged' only because this was no original research and just restating a newspaper report in a totally -ve light, obviously omitting the apparent fact that some 500 odd brokerages dominate the show. Doesn't all of us know this pool-account arrangement that brokerages run for their millions of clients? And lastly, who needs to cool down here really? Me or you? Don't be upset with views not matching yours. Come up with facts like I have done and don't get personal over this. Still, I respect your good intent in supporting this story, as well as the intent of the Moneylife writers.


smruti gokhale

In Reply to Tony Joe 6 years ago

I seem to be reading these comments well after another later report where the same Tony Joe is carrying on a tirade on behalf of NSE.

I am a little confused about his charge about arranging facts etc. The question in parliament and the minister's reply is posted in the comments to that article.
So is our Joe saying the Minister "arranged" data provided by the NSE?
How would he know that unless he is an NSE official.
In any case, why doesnt the NSE take that up with the Minister? IMr Narain's letter to the government has said nothing of that sort.
Maybe Joe will have a response to this too (he certainly seems to be spending a lot of time on Moneylife -- take a bow guys), but I dont understand the point of his chatterl...
by the way I trade occassionally and was quite thrilled to know that i am part of a tiny club of just around 1,92,200 or something. cheers


In Reply to Tony Joe 6 years ago

again the pool account bullshit.
its unique Ids, the minister was referring to boss!
a pool account cannot trade on one id. the broker will end up violating 20 diff. laws. get some market education


6 years ago

Moneylife could intimate through an article the names of these top ten companies as well as the Top Ten Dividend paying companies for the benefit of retail investors


6 years ago

Investigative Journlism worth its salt would go into this reality and expose who is really benefitting from the Casino. In the name of the "Small Investor" the Market regulators propose and impliment changes without taking into effect the consequences. The only thing that this dows is to drive out the remaining RETAIL Participation of the Actual Investor (stop calling him a Small Investor - he is the actual investor who should be driving the stock market - And there are enough of them in our country to out number any FII or institutional investor)

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