Market regulator Securities and Exchange Board of India (SEBI) has imposed a total penalty of ₹30 lakh on 11 individuals, including directors, a company secretary (CS) and a chief financial officer (CFO), for engaging in fraudulent and manipulative trading in the shares of Veer Global Infraconstruction Ltd. The action follows an extensive probe that uncovered price rigging, synchronised trades and artificial inflation of the company’s stock price.
The penalised individuals include: Ranjan Sahay, Bhavana Sahay, Rita Kumar, Vibhash Chandra, Shahnaz Khatoon, Satish Ramvilas Upadhyay, Seema Satish Upadhyay, Sanjay R Gupta, Sunita Sanjay Gupta, Jagdish Narayan Patil and Vikramsingh Govindsingh Rajput.
In its adjudication order, SEBI found that the noticees, led by Ranjan Sahay and a network of connected entities, violated provisions of the SEBI (Prohibition of Fraudulent and Unfair Trade Practices) Regulations, 2003 (PFUTP). The violations occurred between March 2021 and September 2022, when the group created a misleading appearance of market activity in the scrip.
The regulator identified multiple links among the entities, including shared addresses, financial connections, common contact details and corroborative call data records, all pointing to coordinated trading behaviour. The entities frequently traded among themselves, contributing significantly to market volumes and indicating a concerted effort to influence both price and liquidity.
SEBI investigation highlighted a sharp rise in the stock price of Veer Global Infraconstruction from around ₹33 in March 2021 to ₹241 by September 2022, despite no corresponding improvement in the company’s financial performance or any meaningful corporate developments. The absence of fundamental triggers suggested that the price surge was driven by artificial factors.
A granular analysis of trades revealed distinct phases of price movement, including steady increases, sudden spikes and intermittent corrections. Even during declining phases, the connected entities were found to be supporting the last traded price through intra-group transactions, effectively sustaining inflated price levels.
The order details extensive use of synchronised trades, in which related parties placed matching buy and sell orders within short intervals at identical prices and quantities. These trades created a false impression of genuine market interest and liquidity. SEBI also detected reversal trades, with shares repeatedly exchanged within the group, thereby generating artificial volumes without any real transfer of ownership.
A notable finding was the group’s outsized influence on price discovery. During one phase, the entities contributed as much as 187% to the net last traded price movement and over 44% to positive price impact through a limited number of trades. A substantial portion of this influence stemmed from trades executed within the group, underscoring the circular, manipulative nature of the activity.
The regulator further observed that the entities played a key role in pushing the stock to new highs by placing aggressive buy orders that raised the benchmark price of the scrip.
Based on the evidence, SEBI concluded that the noticees were involved in a deliberate and coordinated scheme to manipulate stock prices and mislead investors. Such conduct, the regulator noted, undermines market integrity and violates the PFUTP norms, warranting monetary penalties under Section 15HA of the SEBI Act.
Accordingly, Ranjan Sahay, Bhavana Sahay, Mrs Kumar, Mr Chandra, Mrs Khatoon and Satish Upadhyay have been held jointly and severally liable to pay a penalty of ₹20 lakh.
Further, Seema Satish Upadhyay, Sanjay R Gupta, Sunita Sanjay Gupta, Mrs Patil and Mr Rajput have been held jointly and severally liable to pay a penalty of ₹10 lakh.
