Another Rakesh Jhunjhunwala! And a pump and dump operation!
Moneylife Digital Team 11 June 2015
Surana Solar shares jumped 18% after it was reported that ‘Rakesh Jhunjhunwala’ purchased 250,000 odd shares. And then it crashed to its lower circuit next day
Retail investors often fall for stock tips or like to take cues from iconic investors like Rakesh Jhunjhunwala. While tracking ace investors may have its own share of risk, acting on information without checking its authenticity can be even worse as we have witnessed recently. Shares of Surana Solar purchased by namesake investor led to high volatility in the scrip. The day after the news of the purchase, the stock went up 18%, before closing at its lower circuit as the true identity of the investor was revealed.
On Tuesday, 9 June 2015, several news reports like this one here spread that “Rakesh Jhunjhunwala” bought over 250 thousand shares of Surana Solar at Rs53.74 each. Unfortunately, it was not confirmed at that time whether it was the ace investor himself. As it soon turned out, it was a namesake investor based in Kolkata. The stock was up about 9.1% for most part of the day on 10 June 2015, before turning 20%, hitting its lower circuit, soon after the real identity of the investor was revealed. By the end of the trading, 58 lakh Surana Solar shares had changed hands on the NSE, compared with a daily average of just over 1.41 lakh shares last week.
On 11 June 2015, the stock hit its lower circuit once again and closed at Rs35.80, down 20%. This was 43% down from its peak of Rs63.10 on 10 June 2015. 
Was the intention to mislead and was it a case of a deliberate pump and dump of the stock? Surana Solar is an India-based solar company which is engaged in manufacturing solar energy systems with the focus on solar photovoltaic (SPV) modules. As it was later revealed, a Kolkata-based client of Rajkot-based Sun Flower Broking, Rakesh Jhunjhunwala, had purchased the shares.
It looked like this was planned, as on 8 June 2015 too, the namesake investor had bought 250,000 shares, but squared off on the same day. This did not seem to get any attention, but when the long position was taken on 9 June, that was when the other investors caught on. Was the intention to make the stock price to surge so that he could dump a large quantity on the hapless punters. Whether the namesake investor exited or not and at what price remains a mystery. Will the regulator investigate? 
shanti Patel
8 years ago
SEBI has taken note of our EMAIL. and taken appropriate action.

Shanti k.Patel
Hon.Joint Secretary-Bombay Shareholders Association
Krishnan Venkat Subramanan
8 years ago
even the news channels aired an interview with the chief executive of surana solar and he projected a rosy picture.
shanti Patel
8 years ago
Prima-facie it appears that it was a well plan well thoughtful plan.
This is a perfect case to be investigated by SEBI.

Shanti K Patel
Hon. Jiont Secretary- Bombay Shareholders Association
Replied to shanti Patel comment 8 years ago
hello sir,

I am one of the victims suffering huge loss from surana solar share..
any action taken by sebi?
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