SEBI imposes Rs42.50 crore fine on 21 entities for fraudulent trade

SEBI imposed Rs42.50 crore penalty on 21 entities for fraudulent trade on Bharatiya Global Infomedia’s listing

Market Regulator Securities and Exchange Board of India (SEBI) has imposed a penalty of Rs42.50 crore on 21 entities, including companies and brokers, for manipulative share trading on the listing day of Bharatiya Global Infomedia Ltd (BGIL).

SEBI in its order alleged that, these 21 entities were connected to each other and has traded fictitiously in BGIL shares. The entities had executed structured, synchronised and circular trades among each other.

“On the first day of trading on BSE, the BGIL scrip opened at Rs81.9, went up to Rs83, stayed between Rs60-70 for some time and then plunged to Rs29.90 at close. On NSE, it opened at Rs84 (day's high) and then plunged to Rs30.95 at close. Major allottees who were allotted shares in the initial public offer (IPO) of BGIL had sold the allotted shares on the listing day,” SEBI said

SEBI imposed total penalty of Rs42.50 crore on 21 entities out of which VP Patel and Marutinandan Infosolutions have been levied with a maximum penalty of Rs6 crore each. Other entities includes Korp Securities with penalty of Rs5 crore and Rs 3crore each on; GRD Securities, Swift Tie-up and Jalan Cement Works. All entities are mentioned in below table.


SEBI said, “Shree Bahubali International and PELF Finstock had traded in a fraudulent manner so as to give exit to various allottees and thereby created artificial volumes and misleading appearance of trading in the scrip. The other brokers had aided and abetted their clients along with others in the execution of structured trades. As per the SEBI order, the entities made unlawful gains of nearly Rs12.80 crore through the fraudulent trading.”

SEBI also penalised; GRD Securities, Korp Securities, Vimgi Investments, Prem Somani Share Brokers, Shaswat Stock Brokers, Shree Bahubali International and PELF Finstock for violating broker regulations. 

BGIL came out with an IPO in July 2011, which was oversubscribed by 1.47 times and BGIL issued the shares at a price of ­Rs82 to raise Rs­55.10 crore from the market. On 28 July 2011, the shares got listed on National Stock Exchange (NSE) and BSE with total 8.83 crore shares traded on exchanges out of which only 6.5% of shares were delivery based trades.

In 2011, SEBI had barred BGIL from raising capital from the securities market and prohibited the company, its promoters and directors from selling or dealing in the stock market. The order was later confirmed in 2012.


Reliance MediaWorks to delist at Rs61 per share

Reliance MediaWorks to delist from BSE & NSE at the exit price of Rs61 a piece, with 25.39% premium over its floor price

Reliance MediaWorks Ltd (RMW), an ADA Group company, fixed the final exit price for its delisting at Rs61 per share. This is at a premium of 25.39% over the floor price of RMW.

Reliance Land Pvt Ltd and Reliance Capital Ltd, the promoters of RMW, has invited shareholders of the company to submit bids pursuant to a reverse book-building process through the electronic system of BSE and arrived at the exit price.
“The final price determined through reverse book-building process for accepting the equity shares successfully tendered in the delisting offer is Rs61 per share of Rs5 each, which is at a premium of 25.39%over the floor price of Rs48.65,” the company said in a regulatory filing.
“All shares shall be acquired validly tendered at or below the exit price and Reliance MediaWorks shareholders who have validly tendered shares will be paid consideration at the exit price,” it added.

On 20th January, RMW board approved a delisting offer, which was later cleared by the shareholders. Earlier Moneylife wrote; Reliance MediaWorks to delist from BSE, NSE mentioning about the two promoters’ offer to buyback additional 26.7% stake and to delist RMW.

On 11th March, Reliance MediaWorks hits its 52-week high on the BSE at Rs59.75.

On Thursday, Reliance MediaWorks closed 1.72% higher at Rs59.05 on the BSE while the 30-share benchmark closed marginally up at 22,214.


What Indian Railways need to move ahead?

India need to have extra professional help in restructuring the railways, by laying extra tracks, getting bigger capacity wagons and locomotives to move them, and make the freight attractive enough

It may be recalled that, in the interim budget, Railway Minister, Mallikarjun Kharge outlined plans to start 72 new train services, which include 17 premium and 38 express trains. In a year from now, a Railway Tariff Authority is also expected to be set up, which will advise the government on fixing fares and freight rates. It will also have a say in development matters relating to this huge enterprise, which has, at the moment, 35,000 Kms rails, which also carries a substantial quantum of cargo within the country.


Recent development plans to upgrade the railway network has been projected to cost Rs2,000 crore and the target for 2014-15 has been fixed at 1,101 million tonnes of freight. The share of rail in freight is reported to be about 25% compared to 50% in the case of both China and USA. This, one can see, is insufficient utilisation of the cheapest form of transportation available in the country, for which, thankfully, the main fuel element of coal is available in the country, except that, it needs to be mined and evacuated rapidly from pit heads!


Among the many plans that Railway ministry has had, they now plan to push through three crucial railway link projects by 2016 that will facilitate evacuation and delivery of 300 million tonnes of coal annually from mines in Jharkhand, Chhatisgarh and Odisha. These projects were actually started in 1999, and the corridors covered are: Tori-Shivpuri-Kathotia in Jharkhand; Bhudeopur-Korichhaapar in Chhatisgarh and Barpali-Jharasaguda in Odisha.

The new Railway minister, on taking over responsibility, needs to expedite these pending projects rather than spend time to apportion blame for the delays.


Although Japan has been a pioneer in building high speed rail lines, it is China, in a short space of time, laid 13,000 Kms of high speed rail network, laying new tracks on elevated rails, thus avoiding and or by use of minim farm land. In fact, China has been keen to get involved in India in setting up high speed rails. but for a number of reasons, India has not shown keen interest, at this point of time. They would rather secure Chinese expertise in raising the speed in selected corridors. Chinese experts have claimed that they would be able to raise the speed from current 130 Kms per hour to 160 Kms or up 200 Kms, if an opportunity was given to them.


It may be recalled that both India and China have been carrying on a dialogue under the Strategic Economic Dialogue (SED) to discuss and formulate plans for economic development. The third such meeting was held recently, when Planning Commission Vice Chairman, Montek Singh Ahluwalia met the Chinese Premier Li Kiqiang. It is reported that India would seek their expertise in heavy haul and raising the speed on its existing rail network which would possibly require realigning track and strengthening of bridges. At the moment, India is not keen to get the Chinese high speed rails!


Recently, the Chairman of Japan Railway Central, Yoshiyuki Kasai was in the country He has been keen watching the developments in India, particularly the contract that Japan was awarded to carry out a detailed project report into the feasibility of a Mumbai-Vadodara high speed rail line.


He is reported to have indicated that JRC was not looking to invest in high speed rail systems in India, because, first, it needs the Indian government to fund a large part of the infrastructure required before such a scheme can become a reality.


The Chairman of Indian Railways, Arunendra Kumar, appears to have stated that the cost of high speed track would be in the region of Rs120 crore, possibly hinting that it would be an expensive proposition, at least for the time being, to think of building such tracks. Unlike China, which has no serious problems in acquiring the needed land, land acquisition in India is a laborious process, where a disgruntled or a greedy politician can start an agitation to stop the process in no time. We have hundreds of cases where work could not proceed due to these "instigated" public protests and agitations.


Chairman Kasai has observed, while meeting the press persons, that it would be good idea for the Railways to actually use the existing tracks for movement of freight and then, simultaneously, start planning and laying high speed rails to move passengers This suggestion, by him, is worth not only noting but the

Ministry must try to act on the same.


We need to have extra professional help in restructuring our railways, by laying extra tracks, getting bigger capacity wagons and locomotives to move them, and make the freight attractive enough so that the freight from road transport, which guzzles millions of litres of fossil fuel, is reduced.


So far, the captive coal mines have been given to power plants so as to ensure continuity of generation and supply; why have captive coal mines not been allocated for exclusive use by Railways?


(AK Ramdas has worked with the Engineering Export Promotion Council of the ministry of commerce. He was also associated with various committees of the Council. His international career took him to places like Beirut, Kuwait and Dubai at a time when these were small trading outposts; and later to the US.)



Dr Anantha K Ramdas

3 years ago

Mr Shadi Katyal: My statistical data is based on available information for the public; besides please do not make a sweeping statement if the writer has been to the countries concerned or not.

One does not have to go to Seattle to see the Boeing plant; you can still experience the Boeing in Bangalore or in Bangkok by travelling in them.

If TTE are corrupt, unfortunately, you and I who do not make reservations start the bribery part to get what we want. We tempt them; we are just as guilty as they are if they accept the bribe and give us the accommodation. This practice has to stop and it must emnate from those who want to get the job done by bribing.

I have lived long enough in the US and travelled extensively to know how the system works there too. Simply because the "gas" is available, and the roads are a pleasant enough to drive, as much as 25% of the cargo (mostly by branded and corporate kind) moves by road. The rest is by air. Private transport is to be clubbed along with cargo movement because separate figures are not readily available - but these are rough estimates.

By simply improving our railway system, we can save a lot of fuel by getting the goods off the trucks and have them carried by rail. Our tracks are underutilised.

In fact, it would be fair to think that a good management of our rail tracks by professionals would enable us to have greater movement of both goods and passanger traffic. This simple thing one can notice if you are living close to a railway station and watch the actual number of trains that use them.

As for bureaucracy, again, it is in the hands of people who have to utilize their services. If charity begins at home, so does corruption.

shadi katyal

3 years ago

We see such articles often but where is the advise or suggestions how to change and get into new century. The figures for US freight on railways are not correct as writer maybe talking of trucks/containers shipped on railways and later transported by road as method of transportation has changed.,
India first has to correct her bureaucracy as lot of revenue is lost with free travelers or money pocketed by TT. So how can a nation even think of speed trains when she is run so poorly.
Has the writer seen the trains and seating in China or Japan?Can India ever reach to such standard.

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