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Mid-cap issue: Ban on three entities to continue, says Sebi

Last Updated: Friday, January 11, 2013 - 23:12

Mumbai: Sebi Friday said the restraining order on three entities, related to plunge in some mid-cap stocks in July, would continue as they failed to show "sufficient and plausible cause" for revoke.

The market regulator through an interim order in August had barred Kuvam Plast Pvt Ltd, Manish Agarwal and Ajit Kumar Jain among the 19 entities from the securities market, following an initial probe into the steep decline in share prices of some mid-cap stocks in July.

In the light of the facts and circumstances, "I am of the considered view that no intervention is called for, at this stage, in either vacating the interim directions or modifying it, with respect to noticees," Sebi Whole Time Director Rajeev Kumar Agarwal said.

"...Noticees (Agarwal, Jain Kuvam Plast) have not been able to show sufficient and plausible cause to draw any inference other than drawn in the interim order with regard to their trading in the respective scrips at this stage," Sebi said.

Sebi is probing the sharp plunge of 20-26 percent in the shares of mid-cap companies -- Parsvnath Developers, Pipavav Defence and Offshore Engineering, Tulip Telecom and Glodyne Technoserve -- at the BSE and NSE on July 26.

These stocks had seen sharp intra-day movements in both price as well as volume on that day, even though no major announcements or price sensitive information was disclosed to the exchanges by these companies in the previous 15 days.

As per the interim order, the entities were instrumental in pulling the price of these scrips down during the identified time period as they were placing sell orders below the best sale and buy price during the period.

"...These entities are prima facie connected to each other as alleged in the interim order," Seb said.


First Published: Friday, January 11, 2013 - 23:12
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