Exchanges, market regulator sleep as operators rig Shree Ashtavinayak shares with impunity

The stock has hit the lower circuit for eight days in a row. Market players blame operators close to promoter circles

It has hits like Dabangg and Golmaal 3 under its belt and it is planning a few more blockbusters. Yet, the stock price of Shree Ashtavinayak Cine Vision (SACVL), this successful movie producer, is crashing. The stock price has plunged from around Rs 50 on 5th November to Rs18.50 today. And what a crash it has been.

Since 25th November, on every single day of the last eight trading days, the stock has been locked in the lower circuit. This kind of crash happens when a company is in dire straits. We asked around but nobody had heard of any kind of trouble for the company. What then is the issue?

SACVL has been what is called an "operator-driven" stock. This means that a bunch of big players with the help of people close to the promoters effortlessly rig the prices up and down as they please, even as the stock exchanges and the market regulator

Consider this. The stock price of SACVL on 5th November touched Rs51.20 and closed at an all-time high of Rs49.65 on that day, the highest level since the previous peak in February 2010. Over the next fortnight the price slipped to Rs43.50 on November 24, then moved up again to Rs45.75 on 25th November, from which level it has been falling continuously.

There appears to have been a similar pattern in February this year, when the stock price reached around Rs33. There was a similar crash and the stock was locked in the lower circuit for days on end until it touched a low of Rs10.65 in intraday trading on 11th March.

Clearly, it's useless to correlate the stock with the company's business. Dabangg set a record by grossing around Rs 80 crore in the first week, making it the highest grossing Bollywood film in 2010. The film also did remarkable business overseas. Its  next production, Run Bhola Run, is expected to be released in February 2011.

However, investors seeking to buy the stock on the basis of the performance of these film productions could well burn their fingers. "It is a stock consistently rigged by operators," said an official with a top equity trading firm, who requested anonymity.



Shiva Krishnan

6 years ago

Thank you for updating me by sending instant mails.Such updates really helped me to tackle questions in Interview.


6 years ago

Past examples of similar scrips prompts one to consider buying such a scrip (eight lower circuits in a row!!) at these beaten down levels...albeit with the clear understanding that this is a high-risk-high-gain speculative bet...because, the operators who have slammed the stock so severely are also capable of jacking it up some day. The next hit on the box office from the company & the upper circuits may start!!

nagesh kini

6 years ago

who'll shake the regulator out of the slumber?
a case of good rules in place no one to enforce them!

Food retail in India to touch $150 billion by 2025: KPMG

New Delhi: Driven by the growth of organised retail coupled with changing consumer habits, food retail sector in India is set to more than double to $150 billion (around Rs6,70,870 crore) by 2025, reports PTI quoting a report by KPMG.

India's food retail sector, which is currently estimated at $70 billion (around Rs3,13,137 crore) will more than double in the next fifteen years, the global audit and advisory firm KPMG said.

“Evolution of innovative food processing capacity, emergence of organised retail and change in consumption patterns along with fast changing demographics and habits is fuelling the next growth trajectory for the food industry in India,” KPMG said in a statement.

Despite the potential, the sector has not yet seen sufficient investment, especially foreign direct investment (FDI), the report said.

“The food sector, in spite of its large share of GDP and the consumer basket, received only 3.3% out of the gross FDI flows in India between 2000 and 2010,” KPMG executive director Ramesh Srinivas said.

High growth in food retail is limited by sub-optimal supply chain caused by low investment in the sector, he added.

Some players such as McDonalds, RK Foodland, Jubilant Food Works (Dominos) have, however, invested in back-end processes, optimised supply chain management, according to KPMG.

“There is also considerable investment in the cold chain industry by multinational corporations and private equity firms,” Mr Srinivas added.


Jindal Steel and Power subsidiary starts production in Oman

Jindal Steel and Power Ltd (JSPL) said its subsidiary Jindal Shadeed has started trial production of hot briquetted iron (HBI) from its plant at Sohar Industrial Port area in Oman. 

Jindal Shadeed started the trial production almost five months ahead of schedule on 5 December 2010. The initial target date for the plant was 31 March 2011. 
The feat was achieved by the well co-ordinated efforts of Jindal Shadeed, its contractors and sub-contractors along with the strong support of the local community and the Omani government.

Jindal Shadeed has installed a 1.5 MTPA (million tonnes per annum) gas-based HBI plant at Sohar Industrial Port area. This facility will support the strong demand for steel in the Middle East and North African countries, which has an anticipated supply shortfall estimated at more than 12 million tonnes.

On Tuesday, JSPL gained 0.26% to Rs700.90 on the Bombay Stock Exchange, while the benchmark Sensex closed 0.23% down at 19,934.64 points


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