Regulations
GDR manipulation case: SEBI allows KII to sell securities

In September 2011, SEBI had restrained KII, a sub-account of Credo Capital, from dealing with securities in the domestic market in the wake of its alleged involvement in manipulating GDRs

 

Mumbai: Market regulator Securities and Exchange Board of India (SEBI) has allowed KII Ltd, which is accused of manipulation in issuance of financial instruments overseas, to sell securities held in its demat account, reports PTI.

 

KII is a sub-account of foreign institutional investor Credo Capital Plc.

 

In September 2011, SEBI had restrained KII from dealing with securities in the domestic market in the wake of its alleged involvement in manipulating global depository receipts (GDRs)—a financial instrument used to raise capital overseas.

 

SEBI said that it was modifying “to the limited extent”, the interim order issued in 2011 that had barred KII from dealing in the capital market.

 

“KII is permitted to sell its securities held in its dematerialised accounts and deposit the sale proceeds with any scheduled bank,” SEBI said in an order on 23rd January.

 

In case, KII intends to utilise any or whole of the sale proceeds, it shall seek specific permission from SEBI indicating reasons for making such request, it added.

 

However, SEBI noted that the trading strategy of KII in the matter was “prima facie not in the interest of the securities market” and it cannot be termed as an “innocent bystander”.

 

SEBI had in 2009-10 received alerts regarding large scale off-market transactions in its IMSS system in shares of IKF Technologies, Cat Technologies, Avon Corporation, Asahi Infrastructure and K Sera Sera.

 

The regulator had prima facie found that KII among a few other entities was cancelling the GDR of the companies and converting them into normal shares for sale in the Indian securities market, to a few selected counterparties.

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RBI cuts CRR, repo rate by 25 bps to perk up growth

While repo rate cut will reduce the cost of borrowing for individuals and corporates, the reduction in CRR would improve the availability of funds

Shedding its nine-month long hawkish monetary policy stance, the Reserve Bank of India (RBI) on Tuesday slashed its key interest rates by 0.25% that would release Rs18,000 crore additional liquidity into the system to perk up growth through reduced cost of borrowing, reports PTI.

 

RBI governor D Subbarao in the third quarter monetary policy review surprised the market by cutting short-term lending rate called repo by 0.25% to 7.75% and cash reserve ratio (CRR) by similar margin to 4%, releasing Rs18,000 crore primary liquidity into the system.

 

While repo rate cut will reduce the cost of borrowing for individuals and corporates, the reduction in CRR, which is the portion of deposits that banks have to park with RBI, would improve the availability of funds.

 

“The stance of monetary policy in this review is intended to provide an appropriate interest rate environment to support growth as inflation risks moderate,” Subbarao said while unveiling the policy review.

 

The RBI, however, has reduced the growth projections for the current financial year to 5.5% from its earlier estimate of 5.8%.

 

On inflation, it moderated the rate to 6.8% for March-end from earlier projection of 7.5%.

 

HIGHLIGHTS

Following are the highlights of the RBI's third quarter monetary policy review:

 

* Short-term lending rate or repo rate reduced by 0.25% to 7.75%, first time in nine months.

 

* Reverse repo rate stands adjusted to 6.75%.

 

* Reduces cash reserve ratio (CRR) by 0.25% to 4%.

 

* CRR cut to infuse Rs18,000 crore in system from 9th February

 

* RBI trims growth for fiscal 2012-13 to 5.5% from 5.8%.

 

* Policy action aimed at aiding growth by encouraging investment and improving liquidity to support credit flow.

 

* Review intends to contain inflation and anchor inflation expectations.

 

* RBI says inflation has come off its peak.

 

* Revises downward March-end inflation projection to 6.8% from 7.5%.

 

* Q3 CAD likely to widen beyond 5.4% of GDP.

 

* Bank rate stands adjusted to 8.75% with immediate effect.

 

* Next mid-quarter review of monetary policy on 19th March.

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COMMENTS

snehakamath

4 years ago

Expectaions were that the interest reduction by 25 basis points and not any CRR cut.

Hence positive surprise. Let us understand which banks will get benefitted by CRR cut of 0.25% ?

Large release of cash which was idle and fought tooth and nail by SBI head ( despite he losing some tooths and nails !!!)

Surely large banks will get largely benefitted by this generous move of putting extra money which was not attracting any interets being deposited with RBI !

Do we need sooth sayers to inform us that SBI,Canara bank , PNB , BOB among puyblic sector will make a wind fall profits ! or do we need some one to confirm us that ICICI , HDFC will get benefitted !!

Thanks these are seen some corrections today and in the morning tomorrow if trend continues will further fall a little , Those who will grab will laugh their way to bank in less than 3 months straight and if there is another CRR cuts and interest rate reduction then minimum appreciation of 50% + for most of these shares.

Check history during the interest rate reduction cycle these banks have tripled and quadrapled in price last season.

Happy profits for thise who have courage and grab them. All these are safer bets as when they fall they fall a little, when they rise they rise maximum and are Bluest of Blue chips

SEBI allows exit of Hyderabad Securities as a stock exchange

Hyderabad Securities and Enterprises may continue to function as any other corporate entity or any other normal broking entity but would not use the expression “stock exchange” or any variant in its name or in its subsidiary’s name

 

Mumbai: Capital market regulator Securities and Exchange Board of India (SEBI) has allowed Hyderabad Securities and Enterprises (HSEL) to exit as a stock exchange, reports PTI.

 

“I am of the view that it is a fit case for allowing exit HSEL (erstwhile Hyderabad Stock Exchange),” SEBI whole-time member Rajeev Kumar Agarwal said in its order dated 25th January.

 

“HSEL or its subsidiaries (if any) may continue to function as any other corporate entity or any other normal broking entity. Further, HSEL shall not use the expression ‘stock exchange’ or any variant in its name or in its subsidiary’s name so as to avoid any representation of present or past affiliation with the stock exchange,” he added.

 

According to the order, the company complied with SEBI’s exit guidelines and paid the necessary dues to the regulator, including 10% of the listing fee and the annual regulatory fee.

 

HSEL has shifted the companies listed exclusively on it to the dissemination board of BSE, said SEBI.

 

SEBI added that the company has set aside funds in order to provide for an ongoing arbitration case.

 

Besides, the exchange has paid an amount of Rs1 crore to it for resolving investor complaints if any, that may arise in future.

 

Further, HSEL has transferred Rs3.09 crore available in its “Investor Protection Fund” and “Investor Services Fund” and 1% security deposit amounting to Rs82.76 lakh available with it to the SEBI's Investor Protection And Education Fund (IPEF)

 

Earlier in August 2007, SEBI had de-recognised Hyderabad Stock Exchange as a bourse for failing to dilute 51% stake to non-brokers as mandated by law. About 700 stocks were listed on the HSE, but daily trading is of insignificant value.

 

SEBI noted that there are currently 25 stock exchanges across the country most of which are non-operational and only five have trading on their platform which includes NSE, BSE and MCX.

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