Stocks
Retail investors in Jay Energy suffer loss due to continuing demat delay

The company relisted in September last year, but registrars repeatedly put off dematerialising shares on excuse of faulty master data. Investors demand investigation into alleged manipulation

Many small retail investors of Jay Energy & S Energies Ltd are struggling to dematerialise their physical shares, because, according to the company's registrar transfer agents (RTAs) the master data of shares is not in order. And those retail investors, who have managed to dematerialise their physical shares after a long struggle, have already missed the opportunity to sell the shares at higher prices.

Jay Energy & S Energies tied up with the National Securities Depository Ltd (NSDL) and re-listed the stock after 13 years on the Bombay Stock Exchange (BSE) on 29th September 2010, but the move appears suspicious. On 30th September, the company informed the BSE about the shareholding declaration, saying that the company had dematerialised 42.82% of the total 6,797,700 shares. The company dematerialised 48.86% shares of promoters, who own 2,250,000 shares, while 39.83% of the holding of non-promoters, who have 4,547,700 shares.

But retail investors were not informed about the relisting and the shareholding declaration. After seeing the notice of shareholding declaration on the BSE and noting that 39.83% of the non-promoter shareholding had been dematerialised by 30th September 2010, the retail investors started sending physical shares for demat.

However, the company's RTA-Purva Sharegistry (India) Pvt Ltd-did not accept any applications of retail investors to demat their shares, as Jay Energy & S Energies had instructed it not to process any transfers or demat requests as the company was in the process of changing the registrar.

"Yes, we asked Purva not to process any demat or transfer requests as we were in the process of appointing our new registrar, because Purva did not complete the given work on time," Mihir Parikh, director, Jay Energy & S Energies told Moneylife.

However, according to SEBI guidelines an existing RTA can continue to process requests for demat/share transfer until a new RTA is appointed.

Meanwhile, Jay Energy & S Energies appointed Cameo Corporate Services (CCS) as the new RTA. CCS delayed processing requests by retail investors to demat their shares, for two months, saying it had not established 'connectivity' for the scrip and had not received records from the company.

The struggle of shareholders did not end here. After connectivity was established in early December, CCS informed investors that "the master data of shares is not in order and the certificate numbers and distinctive numbers are not tallying with the master data of shares."

"We will complete the dematerialisation process within the next one week," said Mr Parikh. However, he declined any further comment.

This is strange, for when the company got re-listed, 39.83% of non-promoters' shares were converted into demat with the same master data of shares. Why didn't the registrar raise the same problem then, ask investors.

Was the master data of shares made an excuse to create an artificial scarcity and influence the share price? Or was the data bad even before 30th September 2010 and were procedures violated at the previous registrar to allow over 39% of shares to be dematerialised without a problem?

The capital market regulator must find out who the "favoured" people/entities were who managed to get their shares dematerialised quickly and just in time on the resumption of trading in the scrip from 29th September 2010, and without facing the issue of incorrect master data.

Many shareholders have raised these issues with the Securities and Exchange Board of India (SEBI), the National Securities Depository Ltd (NSDL) and the Ministry of Corporate Affairs, but they have not received any response so far.

Dematerialised shareholding increased to 55.19%-- made up of 48.86% of the total promoters' share holding and 58.33% of the total non-promoter holding--by 30th December 2010. However, NSDL statistics for 31st December 2010 showed that 292 demat requests of the company were pending for more than 21 days.

Finally, some retail shareholders started getting dematerialised shares back in January this year. However, some are still waiting for their shares to be demated.

Jay Energy & S Energies announced that it had fixed 15th February 2011 as the record date for the purpose of change in face value of the equity shares from Rs10 to Rs2 per share.

However, retail investors have not benefited from this as share prices fell dramatically from a peak of Rs203.45 on 5th January 2011 to Rs66.70 on 11th February (before the share split). Today, the stock trades at Rs6.15 (about Rs30 pre-split), a whopping 85% down in just three months.  

It seems that the non-promoters, whose shares were dematerialised before 30th September 2010, earned mammoth profit and on the fear of a share split, the big non-promoters sold their shares and that this led to a fall in share prices.

User

COMMENTS

Bosco

5 years ago

The criteria to start investigations in the scrip of a company is stipulated
under section 11(C)(1)(a) and (b) of the SEBI Act, 1992 which says:
“11C. (1) Where the Board has reasonable ground to believe that –
(a) the transactions in securities are being dealt with in a manner detrimental to the investors or the securities
market; or
(b) any intermediary or any person associated with the securities market has violated any of the provisions of
this Act or the rules or the regulations made or directions issued by the Board thereunder”
In the Jay Energy case, while investors shares were stuck in demat/transfer for months, the stock price went places (High was RS 203). By the time investors started receiving their shares, the stock went into a tailspin.
The Director of the company has openly admitted asking the old RTA Purva Sharegistry (India) Pvt Ltd to stop processing demat & share transfer requests at the beginning of Oct 2010, much before the new RTA could be appointed and begin work, thus leaving shareholders with no recourse to get shares transferred / dematted .
New RTA claimed that sharemaster data given to them was in shambles, hence further delay.
So if this saga is not deemed "detrimental to the interest of the investors", and a fit case for a SEBI investigation , i wonder what is ?

Bosco

5 years ago

Stock has halved even from the low rate of 3 months ago.
I hope some well-heeled shareholder takes the company and it's old & new RTA's (who collectively held up shares in demat for months on end while the stock reached fancy levels) to court & asks for compensation for all shareholders whose shares were held up beyond the permitted time frame.

adaljaarun

6 years ago

complaints are already there but no action from exchanges as company is taking care in all respects of regualatories so nothing can be done you have loose your money.

REPLY

Bosco

In Reply to adaljaarun 6 years ago

Suggest you to inform MoneyLife about this, after you get your shares & are able to exit the stock.

vijay

In Reply to Bosco 6 years ago

I think all complaints shows Dust Bin......No Complaints...........No Action........

Bosco

6 years ago

In my personal opinion, between the following 3 parties, shareholders have been terribly shortchanged & there is a case for them to seek compensation for the lost opportunity to sell the share at high rates while their shares were stuck for 5-6 months in demat / share transfer :
1. Jay Energy & S. Energies Ltd – for asking the old RTA Purva Sharegistry (India) Pvt Ltd to stop processing demat & share transfer requests at the beginning of Oct 2010, much before the new RTA could be appointed and begin work, thus leaving shareholders with no recourse to get shares transferred / dematted . Same has been openly admitted by Mr. Mihir Parikh, director of Jay Energy & S Energies Ltd to MoneyLife
2. Purva Sharegistry (India) Pvt Ltd – for agreeing to this highly suspect request despite knowing that as per procedure they were duty bound to continue to handle demat requests & share transfer requests till the new RTA established connectivity with NSDL/CDSL. The form to be filled up by outgoing RTA specifically has this clause mentioned . You can view & download the same here : http://www.cdslindia.com/downloads/rta/%...
3. Cameo Corporate Services Ltd – for delay in dematerializing the shares from the time connectivity was established in Dec 2010. Cameo claims the share master data given to them was in very bad shape – this in turn points to Jay Energy’s culpability – but was it really so ? And if it was, how come Purva dematted huge number of shares before 30th Sept 2010 ? Did Purva do so to favour certain people ?
Only a full fledged SEBI investigation can give justice to aggrieved shareholders.

REPLY

vijay

In Reply to Bosco 6 years ago

Dear Bosco.......I agree with you sir and SEBI must investigate the matter without further delay.

NAYNA BHARAT BHAVSAR

6 years ago

i have submit my physical shares for transfer at dated 26/10/2010 of jay energy at registered office but i have not received my transfer share till today. my folio number is 7144 for 200 shares and folio no. 7739 for 200 shares total 400 shares i have submit for transfer but company cannot reply me so please legal action against company can proceed.
with regards,
nayna bharat bhavsar
(m) 09327071694

vijay oswal

6 years ago

Dear Sir,
SEBI must punished promoters of companies like JAY ENERGY who have only vested interest in PRICE RIGGING and not in Company. SEBI must give order to promoters to compensate losses to small shareholders which are ORIGINAL shareholders since public issue of company and kept faith in company for more than 15 years.

vijay oswal

6 years ago

Dear Sir,
Thanking you very much for disclosing MODUS OPERANDI of promoters of JAY ENERGY. I am still awaiting to get my shares transferred in my name which were sent in 1996 for transfer,which clearly suggests manipulation happened in price rigging.

arun adalja

6 years ago

their contact no given on bse site is changed and it is 07930221822 and registrars no not given on bse site and no 02652341105.

arun adalja

6 years ago

yes i also faced this problem and i sent by courier and i had acknowledge but still company says they have not recd courier and price dropped to 50% sebi must penalise with heavy penalty.

India-Pakistan cricket match breaks all viewership records, says aMap

The much-awaited encounter between the two neighbours attained a record viewership of 20.02 points, unheard of in the Indian television space. Cricket fever has led to a 514% increase in the ratings for the sports genre over the average on the last four Wednesdays

The Indian cricket team, which is on the verge of winning the World Cup, has already created history for television viewership. The semi-final between India and Pakistan on Wednesday saw the ratings peak at 20.02, which no event, no match, no show, has achieved so far, according to Audience Measurement and Analytics Ltd (aMap). aMap is an overnight TV audience measurement system that provides data on multiple dimensions like demographics, ownership and viewership.

"World Cup matches have seen high viewership numbers… be it India against England, or India against Australia. However, the India-Pakistan match surpassed all expectations, attracting ratings of 11.7 and getting peak ratings of 20.02 points. The madness associated with the India-Pak match was in true form and with 67.3 million viewers watching the match on TV, it was the grandest of all events," said Jiniti Shah, vice-president, aMap.

According to aMap, the time spent per viewer for the India-Australia match was 115 minutes, for the India-England game it was 99 minutes, and the involvement shot up to an electrifying 160 minutes per viewer for the titanic tie on Wednesday. It said the time spent for the sports genre shot up by 248%, which contributed to the high jump in gross rating points (GRPs).

Women in India, normally perceived to be not too keen to watch cricket matches, were glued to the TV sets throughout the matches. The female target group (TG) has shown a tremendous growth, especially cable and satellite (CS) housewives (working) showed an increase of 49% and CS housewives showed increase of 33% across all TGs, from 15+ years females that witnessed a 30% increase in viewership to CS 4+ years females viewership that increased by 31%, the audience measurement service provider said.

While sports channels witnessed robust viewership, general entertainment channels (GEC) saw viewership dip by 20% during the semi-final match on Wednesday. aMap said, "The match led to a 20% dip in GRPs of the GEC genre with a subsequent increase of 514% in the sports genre over the average of last four Wednesdays. The net reach for the sports genre increased by 80% over the average of last four Wednesdays."

User

Alphonso mango prices shoot up as most of the crop is destroyed by pests, cold weather

Exports of the king of fruits will be affected too; horticulturists blame low-quality pesticides for crop loss

Alphonso, the king of fruits which grows mainly in Maharashtra’s Konkan region, will be costlier this season.

A whopping 80% of the crop in the region has been destroyed due to a prolonged winter and continuous pest attacks. According to horticulturists, despite agricultural advancement, pesticides available in the market are not up to the mark and farmers depending on these products have suffered heavy crop losses.
 
A horticulturist from the region told Moneylife, “It’s not like, we don’t have any solution. There are a lot of pesticides available in the market. But when it comes to quality they all are low grade. There are many such low-quality pesticides available. Farmers use whatever is available in the market. There is a need for quality control, otherwise this will continue.”
 
The horticulturist who request anonymity, explained, “Farmers are willing to pay more for pesticides or anything that will take care of the crop, but ultimately they end up using these low-quality pesticides. This time these inefficient pesticides and unfavourable climate resulted in destruction of the Alphonso mangoes.”
 
According to Dr Bharat Salvi, horticulturist, Regional Fruit Research Station at Dr Balasaheb Sawant Agricultural University, “Around 80% of the mango production is destroyed due to the climatic condition. The crop was exposed to cold temperature for a long period of time. Apart from this, hopper and thrips attacks also contributed to destruction. Only 20% of the normal production will be available in the market.”
 
Understandably, dealers expect the prices of Alphonso mangoes to stay high this season due to the shortage. “The prices are really high this time because of the supply crunch and prices will remain high unless new produce arrives in the market. Again it won’t come down heavily,” explained a fruits dealer, Bhoble & Company, at the APMC market in Vashi. “All mangoes from the Konkan region, mainly Ratnagiri, Deogadh, Sindhudurg and Vijaydurg have been destroyed due to the erratic climatic conditions. At the retail market, the best quality mangoes are available at Rs1,400-Rs1,500 onwards.”
 
Another dealer said, “Last year the produce arrived in phases, in March, April and May. This time only 25% of the mangoes that are usually received in March have come in. Prices may see a very slight drop when the new stock arrives. This is expected by 15th April. In the retail market the prices of Alphonso is anywhere between Rs400 and Rs1,000 a dozen.”
 
Even mango exporters expect a more than 50% dip in business on account of the lower supply. The scarcity has already resulted in a price spike, but overseas consumers are not willing to pay more for the fruit.
 
Parag Gandhi, who exports mangoes to the US and the UK said, “Exports will be terribly affected. We expect up to 50% loss in business. Already there is a problem over infrastructure for export of mangoes to the US, which is a very competitive and qualitative market. Now there is also lower production. There is a huge gap between availability and applicability of effective agricultural methods. This should be addressed to avoid any production loss.”
 
Ekram Hussain, another exporter of mangoes to Bahrain and Singapore, said, “Overseas consumers are not ready to pay high prices. Prices are high due to unavailability of sufficient mangoes for export. We expect more than 50% dip in the export of Alphonso. Kesar, another mango variety that is exported, is yet to come to the market. Again, the prices will be high for them as well.”
 
With the steep rise in mango prices, it seems that the aam admi will not be able to relish the favourite aam this summer.

User

COMMENTS

nagesh kini

6 years ago

This is a forewarning of days to come. While this is an act of God, Jaitapur Power Plant will kill whatever is left of the mango tree that have been standing there for years. This project post-Japan nuclear melt down not based on time tested technology in a biodiversity hotspot on a siesmically vulnerable location ought to be shot down more particularly when nations like Germany and others are considering scrapping NPP and moving back to coal and gas. Are you listening Jairam Rameshji?

madhukar c sheth

6 years ago

Are you sure Alphonso producers are not trying to fool dealers & consumers by talking of low crop high price ?
There are lobbies everywhere.
Once I read an American research report, appreciating virtues of Almond. At the bottom, it was honestly written " THIS RESEARCH WAS FUNDED BY ALMOND GROWERS ASSOCIATION OF USA "

REPLY

Alekh

In Reply to madhukar c sheth 6 years ago

That's exactly what we had suspected and we still believe that there is something wrong. But so far nobody is confirming.
Lets wait and watch till 15 April when the second phase produce will arrive in the market.

We are listening!

Solve the equation and enter in the Captcha field.
  Loading...
Close

To continue


Please
Sign Up or Sign In
with

Email
Close

To continue


Please
Sign Up or Sign In
with

Email

BUY NOW

The Scam
24 Year Of The Scam: The Perennial Bestseller, reads like a Thriller!
Moneylife Magazine
Fiercely independent and pro-consumer information on personal finance
Stockletters in 3 Flavours
Outstanding research that beats mutual funds year after year
MAS: Complete Online Financial Advisory
(Includes Moneylife Magazine and Lion Stockletter)