The Securities and Exchange Board of India (SEBI) has halted the listing of securities of Vaswani Industries , whose initial public offering of shares had closed on May 3, saying subscriptions in the qualified institutional and high networth categories was artificially inflated.
"Certain applications were submitted to artificially inflate the subscriptions in QIB and HNI category to attract and mislead the investors," the stock markets regulator said in a statement.
"Post the closure of the issue, the same applications are being withdrawn by way of stop payment, stop allotment, cheque return, wrong cheque dates, etc," it said.
Alleging that this was a "pre-planned move" amongst the promoters, lead managers and other operators, SEBI said the listing of securities of Vaswani should be stopped till an investigation of the withdrawal of applications is completed.
SEBI said a detailed investigation shall be initiated and completed within 30 days from the date of the order.
Investors should be given an exit option so that securities allotted to them during the IPO can be withdrawn, before permitting the listing, the regulator added.
Vaswani Industries had fixed a price band of of Rs 45 to Rs 49 per share for its initial public offering of 10 million shares. It had appointed Ashika Capital Limited as the book running lead manager to the issue.
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