Bodal Issue: Sebi Bars Three Co's

Wednesday, August 31, 2011
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Mumbai: Suspecting manipulation of share prices of Bodal Chemicals through fraudulent announcements in the name of the company, Sebi today barred three entities from markets and directed bourses to hold back their settlement for August 29. Sebi prohibited 'Hemaliben Bimalkumar Mehta', 'Charuben Jitendrarai Mehta' and 'Bhavana Gautambhai Vaghasiya'from buying, selling or dealing in the securities market till further directions. The preliminary investigations found that these persons were among the major sellers of the stock before denial of fraudulent announcements by the company. Yesterday, the company had denied issuing any announcement regarding bonus issue and their plant sale after BSE received press releases to this effect on the company''s letter head. Share prices of Bodal Chemicals surged nearly 10 per cent intra-day yesterday but closed in the red after the company termed the early morning press releases as fraudulent. In an order Sebi asked "BSE and NSE to withhold the pay-out of securities and funds for the trading done on their respective exchanges on August 29, 2011. "The purpose of this exercise is to ensure that the securities/funds are not disposed off by the alleged perpetrators of manipulation". Sebi said it appears that there was an attempt to "push apparently fraudulent announcements with a positive news in the public domain in order to mislead investors and a concentration of selling by a few entities". Shares of Bodal Chemicals today plunged to a 52-week low before declining 8.45 percent to close at Rs 16.80 on BSE. On the National Stock Exchange, shares of the company settled 9.76 per cent lower at one-year low of Rs 16.65. BSE yesterday said it was investigating the trading of shares in Bodal Chemicals, following the company''s denial that it had not issued a notice for a bonus issue. The market regulator stressed that it was imperative for Sebi to intervene and prevent the attempt of a few to decamp with such prima facie ill-gotten profits.
Source: PTI
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