Regulations
SEBI’s new circuit filters to be calculated on daily basis

In an attempt to curb volatility, SEBI has modified the limits of the circuit filter of indices, which will now be calculated on a daily basis instead of on a quarterly basis

Market regulator Securities Exchange Board of India (SEBI), has modified the circuit filter mechanisms for stock exchanges, particularly the BSE and National Stock Exchange (NSE). The move is aimed to supposedly contain volatility. The SEBI circular (CIR/MRD/DP/25/2013), issued on 3rd September, stated: “The stock exchange on a daily basis shall translate the 10%, 15% and 20% circuit breaker limits of market-wide index variation based on the previous day's closing level of the index.” The new rule is expected to come to effect from 1st October.
 

Earlier, the circuit filter levels were decided on a quarterly basis, while the percentage levels remains the same at 10%, 15% and 20% of the market-wide index variation. When the circuit filter is activated, the market comes to a halt depending on which band is activated (i.e. 10%, 15% or 20%), but this time the duration of the halt has been reduced by 15 minutes for each of the respective percentage levels. After that, there will be a pre-open call auction session in the cash segment of the exchanges.
 

The circular said, “Post-observation of the trading halt, stock exchange shall resume trading in the cash market with a 15 minutes pre-open call auction session. In order to accommodate such pre-open call auction session, the extent of duration of the market halt prescribed vide SEBI circular 28 June 2001 shall be suitably reduced by 15 minutes.”
 

According to SEBI’s old circular (SMDRPD/Policy/Cir-37 /2001, dated 28 June 2001), the duration of the halt are listed below. However, the duration of halt for each band is expected to be reduced by 15 minutes post 1st October.
 

  • In case of a 10% movement of either of these indices, there would be a 1 hour market halt (expected to be 45 minutes, post 1st October) if the movement takes place before 1 pm. In case the movement takes place at or after 1 pm but before 2:30 pm there will be a trading halt for 30 minutes (expected to be 15 minutes, post 1st October). In case the movement takes place at or after 2:30 pm, there will be no trading halt at the 10% level and the market will continue trading.
     
  • In case of a 15% movement of either index, there will be a 2 hour halt (expected to be 1 hour and 45 minutes, post 1st October) if the movement takes place before 1 pm. If the 15% trigger is reached on or after 1 pm but before 2 pm, there will be a 1-hour halt (expected to be 45 minutes, post 1st October). If the 15% trigger is reached on or after 2 pm, the trading will halt for the remainder of the day.
     
  • In case of a 20% movement of the index, the trading will be halted for the remainder of the day. (It is not clear if there will be trading for this band, or whether there will be a 15 minute trading window)
     

The circular was issued after taking into the consideration of the recommendations of Secondary Market Advisory Committee (SMAC).

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Financial Technologies: N Balasubramanian was a director for just five days!

It now appears that the former CMD of SIDBI was appointed as additional director on FT board on 22nd August but on 27th August he submitted his resignation without any explanation for this sudden exit!

Jignesh Shah-led Financial Technologies (India) Ltd (FT) appointed N Balasubramanian as additional director on 22 August 2013. However, within five days, the former chairman and managing director (CMD) of Small Industries Development Bank of India (SIDBI) resigned from the Board. Neither FT nor Balasubramanian have given any reason for this sudden exit.

 

In its addendum issued on 22nd August for the upcoming annual general meeting (AGM), FT mentions the appointment of Balasubramanian as an additional director pursuant to Section 260 of the Companies Act, 1956. The same addendum also mentions Ravi K Sheth withdrawing his consent for re-appointment as a director of the company.

 

"N Balasubramanian who was appointed as an Additional Director pursuant to Section 260 of the Companies Act, 1956 at the Board meeting held on 22 August 2013, and who holds office upto the date of the Twenty fifth Annual General Meeting and in respect of whom notice under Section 257 of the Companies Act, 1956 has been received proposing N Balasubramanian as a candidate for the office of Director of the Company, be and is hereby appointed as a Director of the Company liable to retire by rotation,” the notice says.

 

In addition, the company board also recommended appointment of Balasubramanian as director through another addendum issued on the same date.

 

However, the next addendum to the AGM notice, issued on 27th August, says that FT had received a letter from both Balasubramanian as well as CM Maniar, resigning from the Board. The directorships of Financial Technologies group are turning out to be a joke.

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IBMA: A broker, member, a company of NSEL’s promoter FT, but appearing as a trade body?

Indian Bullion Markets Association was one the biggest borrowers from the borrowing/lending racket of National Spot Exchange Ltd, amounting to Rs1,159 crores. With a name like that, was this group of company of Financial Technologies, the promoter of NSEL, masquerading as a trade body, lobbying on behalf of the group?

One of the members very active in scam-ridden NSEL was Indian Bullion Markets Association (IBMA). Contrary to what the name suggests, or what has been claimed by NSEL, IBMA is not a trade association or a lobbying body for industry-related issues. IBMA is yet another FT-MCX group entity which falls foul of the names and emblems statute. But it obviously got the name because of the clout of the FT-MCX group. Since this ‘association’ was an active trader and promoted by the FT group, we had asked Jignesh Shah whether it was a sub-broker of the Exchange. We were told, “IBMA is not a sub-broker but a member of the Exchange (NSEL). It has around 130 bullion dealers and jewellers from across the country as its shareholders. PEC Ltd (formerly Project & Equipment Corporation of India Ltd), a government company, is also its shareholder. It was conceptualised and called an ‘Association’ because it was promoted by NSEL in a cooperative structure along with various stakeholders such as small jewellers and bullion traders, with an aim to work as an aggregator.”

It was lobbying with the ministries of agriculture, consumer affairs and finance. Apparently, these ministries even invited it to be represented on policy-making committees. Is it believable that retired regulators, Union secretaries and other high-ranking bureaucrats on the boards of FT-MCX group companies did not know that a trading member of an exchange was masquerading as an ‘industry association’? It is now disclosed that IBMA was one of the biggest traders with an investment of Rs1,200 crore by 146 shareholders. These investors were clearly lured by the promises of the FT promoters themselves.

All this raises several questions. Were there any Chinese walls between NSEL and IBMA? Did the MCon check or question it? Clearly, the reason why there is no action against NSEL, its promoters or even its sacked employees, is that its tentacles reach far too deep into this government.

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COMMENTS

Srinivas

4 years ago

Many good men become bad later on - I guess JS was one such - ambition, greed, coercion from his investors like ministers, many things might have forced him to cross the lakshman rekha between ethical business and fraud.

REPLY

Vinay Joshi

In Reply to Srinivas 4 years ago

You are sadly mistaken!
Rgds,

Vinay Joshi

4 years ago

Hello Ms.Sucheta & Mr.Debashis,

No answer!? Can you stop print, withdraw?

Regards,

Vinay Joshi

4 years ago

Hello Ms.Sucheta & Mr.Debashis,

In your own authored book you have praised Jignesh Shah, narrated him to be top achiever & have ranked him to be in the few people you mentioned importantly notable Mr.Keki Dadiseth & Mr. K. V Kamath who command world resp & not only of India Inc, or others.

Now why are you tanking him? Perception change? Then & now!?

Like Harshad Mehta!

Regards,

REPLY

Vinay Joshi

In Reply to Vinay Joshi 4 years ago

Hello Ms.Sucheta & Mr.Debashis,

STILL THE BOOK IS PROMOTED & NEITHER WITHDRAWING IT!

Regards,

Sucheta Dalal

In Reply to Vinay Joshi 4 years ago

ARe you writing off all the people and their insights in the book? Your extreme attitude is rather strange. If you feel so strongly, how about buying out our copies-- printed at our own cost? You can then burn them.
Another example of how you have ZERO appreciation for our work, which you say you admire. And even BIGGER ZERO appreciation for our personal investment of time and money in what we do.
Telling people what is wrong with them and needling them on every sentence is so easy, right? you do it to every one of our authors. Yet, you say you appreciate what we do!! :-)
Oh boy... if these are our admirers we are in terror of what our enemies think of us!!

All the best Mr Joshi - have a nice time in your utopian world, where you are free to lecture but dont need to do anything! :-))

Vinay Joshi

In Reply to Sucheta Dalal 4 years ago

Hello,

I've only talked of JS!? Expecting the chapter will be expunged! Have you ever known books are bought & burned? With this of your intellectual statement I’m stunned! It defeats my intellectual prowess. Majorly stunned by a statement made by a ‘Padmashree’, awardee!?

Nothing else have i talked & SIMPLY STATED WHEN YOU'VE EULOGISED HIM NOW WHY ARE YOU TANKING HIM? WHY CAN’T YOU STATE IN YOUR ML-NSEL POSTS – JS NO CULPRIT? WHO THE CULPRIT JURY IS OUT? BUT THEN WHAT IS YOU'RE ANALYSIS? WHEN THE SCAM WILL BE UNEARTHED IN TOTO WILL YOU STILL TALK YOUR LANGUAGE? WHO IS AT THE HELM? Answer.

Further the MOST important aspect i've stated is that you had given a status to him to be counted among respected Mr.Keki or Mr. Kamath. That’s all!

Sucheta, I expected with your three decades expertise, acumen etc; that UNKNOWN individuals, NO TRACK RECORD, are starting the bourse[s] [now beleaguered] TO BE INCLUDED AS TOP ACHIEVERS – in your book which can be an outlook for GenX.
STARTING BOURSE!? When SEBI- MCS-SX tussle was there – what you had written?

WHEN NSEL DIRECTORS & CEO & OTHERS viz Anjani Sinha, 2003, SEBI had removed him as Ex.D, A’bad S.Ex, for illegitimate trading activities, all illegal activities were openly done [as if you’re not aware], he was also involved in controversy in 1991-94 ‘physical shares’ stolen from MSE [Magadh S.Ex] resulting in payment crisis.

OoH! You were then busy doing your thesis on Harshad Mehta & now not known NSEL people except JS. In fact in my personal mail to you Sept3, I’ve stated that ---- ‘Today you have come out to state the aspects having stopped short of stating’ – it’s beginning of the end of Jignesh Shah. Where is his unwavering clout from his influential cronies? even when he faced regulatory aspects & all of a sudden a twist. Why the govt. or its regulatory authorities caught unaware then, AWAKENED NOW? One day trading contracts were suspended & then it’s history to be retold. [pl do check the said msg.] – msg sub – why lax regulation? Further I had asked ---
How Blackstone Group LP had invested in FTIL? OR Reliance Cap. in both? FTIL & MCX & dumped at a loss? Which of his seventeen co’s were in profit? [I HAD WRITTEN YOU ON SEPT3, YOUR ML POST WAS ON SEPT4,16:07hrs.]

I’ve also written in this forum that when ED investigated persons hold shares since 2009.

Who was JS & what you've tracked him? ---- This re yr JS & book.

Further Ms.Sucheta – re appreciation – it seems you were lost in writing your ‘angry’ post to me without realizing & reading my other posts in the forum & me talking CSR & ML first mover advantage as e-forum / e-paper in view of hard times of print media world over, TV channels cutting back on programming - & my statement that the Indian print media will take a hit of min 1KCR+ in view of INR depreciation & falling ad revenues. Ads shifting to e-media. Please do make your statement in view of aforesaid aspects. [as if yr print mag is comfortable!?] I had also stated that ‘funds’ will be addressed separately, read your own post to me. Sucheta never expected your posts can be ‘irrational’! Angry post. Anger will conquer you!?

Least expected from you, especially when I had written to you that in 90’s in Press Club discussions I always use to second your view points & further which you have yourself acknowledged in recent time about me quoting to you Stock Holding Corp; expose, buried!
[Hence this will be a story of JS-NSEL-FTIL-MCX-MCX-SX!? Buried, EMMINENT BROKERAGES, clients!?]

Hello Ms.Sucheta, in view of my aforesaid things, in the event you think I’m disparaging the authour’s, & taken for granted their authentic posts – WHY CAN’T THEY ANSWER PROFESSIONAL TO A COUNTER VIEW PUT WHICH [never in my case, idiotic] SEEKS AN ANSWER? This gives me a feeling that what you have written during your time in TOI, IE, etc, etc, readers accepted & you profess it.

Ms.Sucheta, the platform is evaluated on its contents, the authenticity of its post & NOT WHO WRITES WHAT? A COUNTER VIEW POSED, THE AUTHOUR IS BOUND TO ANSWER!
[unless you defeat the aspect & further state ‘letters to editor’ – print media – since centuries “INSIGNIFICANT”!] Why & HOW - William Gamble, answers me. In one of the post, purposely, put thro’ you only – our personal id’s to him – he had stated that then only one quest! Tho’ he answered it. Remember or should I put forth the extracts? He answers my posts – coz his authenticity IS NOT ONE SIDED! I’am also required to answer to my overseas posts.]

ARE YOU SATISFIED BY CALLING ME YOUR ENEMY? [which I’m not, not by my saying!? But instead of “BURNIG” the books ‘YOU have 'BURNT' my feelings to you & Debashis & ML & my respect for you.]

‘If you want to make peace with your enemy, you have to work with your enemy. Then he becomes your partner’. – NELSON MANDELA.

Regards,

chirag shah

4 years ago

Was IBMA a borrower as the headline suggests or a lender? All along it has been suggested that IBMA was a clearing member for other trading members who were lenders.

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