SEBI awaits satisfactory reply from the lead merchant bankers- ICICI Securities—who are merchant bankers to Great Eastern Company IPO
Securities and Exchanges Board of India (SEBI) has sought clarifications from ICICI Securities the lead bankers to Great Eastern Energy Corporation, a coal-bed methane (CBM) explorer, regarding the company's proposed initial public offering (IPO). However, the details of the clarifications are unknown to the public.
SEBI may issue observations on a draft offer document filed with it within 30 days from “the date of receipt of satisfactory reply from the lead merchant bankers, where the Board has sought any clarification or additional information from them”.
The next status update of this will be known on December 6th.
The IPO will consist of 78 lakh shares are issued to public and an offer for sale of 4 lakh shares will be made by YKM Holdings International (i.e. 82 lakh shares of Rs10 each). Deutsche Bank Trust Company Americas has 61.99% stake while YKM Holdings Pvt Ltd and YKM Holdings International Ltd have 26.34% and 10.53% holding, respectively.
As per draft red herring prospectus, there is no mention of floor price, but PTI reports state that the company is expected to mop up Rs400 crore.
As per draft red herring prospectus and restated financial statements, the company’s net worth was Rs426.2 crore and Rs389.06 crore as on March 31, 2013 and March 31, 2012 respectively.
SEBI earlier had received the draft offer documents on 17 September 2013 through its lead manager ICICI Securities Ltd, and the last communication it has received was on 11th November. Since then, it has issued a notice to ICICI Securities seeking some clarifications.
Purvi Sanghvi, an account holder at Axis Bank’s Juhu branch alleges that bank employees forged signatures on locker documents and refused to accept her complaint until she approached the police. The Bank now blames an ex-employee, while senior management remains silent
Purvi Sanghvi, a jewellery designer alleges that her signature on a bank locker agreement has been forged by Axis Bank employees of the Juhu branch in Mumbai, where she holds an account. Worse, she claims, the bank refused to accept her written complaint, forcing her to approach the police and other authorities for redress.
In the police enquiry that followed, Ms Sanghvi claims that a former ex employee (Namita) has apparently accepted the forgery (which is a non-bailable criminal offence under the Indian Penal Code) and said it was done on the instructions of her senior Nirija Raje. The ex-employee is further alleged to have said that ‘she was threatened by the employees (Benoy, Nitin, Nirija, Bhushan & Priyanka) to accept the entire blame and not name other employees, since she had already left the bank and would not face any consequences.
The employees in turn, apparently denied any knowledge about the about forgery and blamed it on the ex-employee (Namita). The issues raise several interesting questions. But primarily, Ms Sanghvi’s complaint is that the bank has not yet taken any steps to rectify the documents and senior management has not responded to her queries.
Explaining the incident, Ms Sanghvi told Moneylife that, she applied for the locker on 8 August 2012 to keep her jewellery safe. Although she signed a locker document, the bank did not give her a copy of the papers. When she asked for documents in May that year, the bank first refused to show her original documents, until she insisted on it. On inspection, she realised that her signature on the last three pages was not correct. Also, the agreement had an incorrect contact number with the correct address. She immediately emptied her locker and called the bank to complain. One bank employee (Nitin) talked with her and told that, they need to look and investigate it.
Since then, she alleges, the bank has been ignoring this issue and refused to accept her first written complaint of 29 May 2013. She then posted a registered letter to Axis Bank on 3 July 2013, after which the bank employees visited her home to convince her not to file a police complaint. On 22 July 2013 bank replied to her letter claiming action would be initiated against an ex-employee, but no such action has been taken.
On 27 August 2013 she approached the Banking Ombudsman, who asked Axis Bank to pay a penalty Rs5,000 for ‘deficiency of service’. Shockingly, the ombudsman has no jurisdiction to grant such compensation, when no loss has occurred or been quantified, say our sources. Experts also say that the Ombudsman can only grant compensation in credit card issues. The order in this case raises a separate set of questions about why the Ombudsman acted outside the purview of the act, to help close the matter. Axis Bank was clearly eager to pay the compensation and close the matter, it also asked her if she wanted to surrender the locker. Except this, bank has not taken any serious actions against malpractices going on inside the bank.
Ms Sanghvi again went to ombudsman on 14th October to receive the order and the ombudsman officer (Debajyoti Datta) said that, “If they cannot locate an ex-employee (Namita) for five months and not do anything about it, that means the bank is involved in it and they are blaming someone who has left the organisation.”
Ms Singhvi has since approached the Department of Banking Operations & Development (DBOD) on 28 November 2013. The person-in-charge there Mohindar had asked her to wait for an answer from the Axis Bank. She has also received a reply from the RBI that “This case is not under the purview of RBI since she received the money from the ombudsman and also because she has done a police complaint.”
After fighting so much, Sanghvi said, “at present, I am waiting for the inquiry officer to do the FIR process however, all employees (Benoy, Nitin, Nirija, Bhushan) in the statements denied knowing anything about the forged signatures and blamed the ex-employee (Namita) for everything. I am worried that this matter will have no proper conclusion and the public will never know the malpractices which happened in Axis Bank.”
Axis Bank, in an email reply to Moneylife said, "Our bank follows a strict policy of dealing with incidents of non-compliance and based on the findings of our enquiry, the Bank has initiated appropriate action. We are committed to resolving this issue and have sought fresh documents from the customer to rectify the documentation. We would also like to mention that the Bank has implemented a directive from Banking Ombudsman pertaining to this complaint."
NSE Nifty has given up more gains as we mentioned on Friday and Monday but a strong downturn is not yet in the offing
For the 2nd day in a row both the Nifty and Sensex have fallen, which means the bears are back. The markets opened lower, and stayed weak throughout the session. A rebound into the green didn’t last long as markets took the turn for the worse and dived precipitously, and was unable to recover despite San Francisco Federal Reserve saying that tapering would be considered only if the US Federal reserve is convinced that the US economy is on the right track. Also, the HSBC Service PMI, a leading indicator, has shown that Indian service sector, including IT, has dipped for the month of November, with Reuters saying that hiring is on “ice”.
The BSE Sensex opened down at 20,839, hit an intra-day high of 20,863 and then trended down to an intra-day low of 20,673 before closing at 20,708 (down 146 points or -0.70%). Similarly, Nifty opened down at 6,187 briefly rebounded to hit an intra-day high of 6,209 then trended down to hit an intra-day low of 6,149 before closing at 6,160 (down 40 points, or -0.66%).
All indices except IT, metals and PSU banks were seen trending down. Realty was the worst hit, down 2.76%. FMCG was down 1.44%.
Of the 50 stocks on the Nifty, 21 advanced and 29 declined, indicating weakness. The top gainers were Tata Power (3.13%); Punjab National Bank (2.76%); Power Grid (2.29%); NMDC (1.75%) and Wipro (1.68%). The top losers were Hindalco (-2.42%); ITC (-2.11%); IDFC (-1.99%); Ranbaxy (-1.83%); DLF (-1.83%).
The Inter-ministerial summit meet at Indonesia is once again likely to fall through as New Delhi states that it would not budge until its demands are met that are meant to be pro-poor. In the finance news the latest HSBC PMI numbers, the services PMI stood at 47.2 vs 47.5 in October, with Reuters saying that hiring is on “ice”. The Cabinet has been reviewing FDI norms in various industries. Sources in DIPP have said that it would rework fresh 25% mandatory investment clause in new units; the finance ministry said that the 25% mandatory investments in new units hinders M&A. Also, the finance ministry as well as the Planning Commission rejected the 49% FDI cap in rare and critical units and will relook into the same, while it has also rejected FDI in pharma last week itself. It is also reported that Power Grid's $1.1 billion FPO has been ‘fully subscribed’.
Asian markets were mixed today. Except for Shanghai (up 1.31%) and Sydney (0.34%), all other Asian markets closed down. Japan’s Nikkei Stock Average fell sharply because the yen regained some lost ground, while the Australian dollar tumbled after the country’s disappointing third-quarter growth data, but its stock market index, All Ordinaries, moved up marginally.
All European markets opened green on the news that the Eurozone economy grew by 0.1% (Italy and France contracted a bit) in the third quarter versus the preceding three months, which is also as per expectations. But at the time of writing, almost all of them had turned red. The Financial Times reports that the Bank of Ireland has placed €540m in new shares to repay state funds, as part of recovery process. A proof that regulation matters, the EU has imposed fines of €1.71 bn on Deutsche Bank, Societe Generale, RBS, JPMorgan, Citigroup, and broker RP Martin, for rigging LIBOR, EURIBOR benchmarks.
According to ComScore, a company that measures consumer data, Cyber Monday desktop sales were seen up 18% to $1.74 billion. However, automobile and retail reports, despite Cyber Monday records, were less than encouraging. The San Francisco Federal Reserve chairman has stated that the US Federal Reserve would taper only if it is sure that the US economy is seen on the right path to recovery. US markets closed down yesterday and US stock futures were seen trending marginally up during early trade.