The order comes after SEBI examined the initial public offering of Birla Pacific Medspa Ltd (BPML) for the period July 7 to 15, 2011.
The order comes after SEBI examined the initial public offering of Birla Pacific Medspa Ltd (BPML) for the period July 7 to 15, 2011.
Capital markets regulator SEBI has fined 10 entities, including Birla Pacific Medspa and Yashovardhan Birla, a total of ₹3.42 crore for violating listing agreements as well as diverting proceeds from the initial public offer of Birla Pacific Medspa Ltd.
The regulator imposed a fine of ₹1.07 crore on Birla Pacific Medspa Ltd, ₹32 lakh on Abhijit Desai, ₹26 lakh on PVR Murthy and ₹25 lakh each on Yashovardhan Birla, Venkateshwarlu Nilabhotla, Mohandas Adige, Anoj Menon, Rajesh Shah, Upkar . Singh Kohli and Tushar Dey.
The order comes after SEBI examined the preliminary public offer of Birla Pacific Medspa Ltd (BPML) for the period 7 to 15 July, 2011.
BPML shares were listed on BSE on 7 July 2011, when the IPO was open for subscription from 20-23 June 2011.
SEBI, in an order dated September 28, said sharp volatility was observed in the share price on the day of listing, which closed at ₹25.35, which was 154% higher than the issue price of ₹10 per share.
BPML received an IPO of ₹65.17 crore, however, the money received in the IPO was not used to set up 55 ‘developed’ healthcare clinics across India as stated in the prospectus by the firm and cost ₹34.91 crore. The amount was Really taken away by the company.
It has also been observed that out of the balance amount of IPO, an amount of Rs 31.54 crore was given as Inter Corporate Deposit (ICD) to various group companies, out of which Rs 18.54 crore was not refunded by the said companies. BPML.
Further, BPML also did not receive interest of ` 6.39 crore from the said companies.
The regulator also held that BPML, Desai and Murthy, as signatories to the quarterly filings to the stock exchange and the company, did not correctly depict the difference between the estimated use of funds made by it and the actual utilization of funds in the prospectus. did.
Therefore, BPML, Desai and Murthy violated the provisions of the SCRA (Securities Contract and Regulation Act) Rules.
It was also observed that BPML had funded certain entities, which were used to support the price of scrips on the day of listing, thereby violating the PFUTP (Prohibition of Fraudulent and Unfair Trade Practices) norms.
Further, BPML has not disclosed any deviations in utilization of IPO proceeds along with its financial results to the stock exchanges and the filing of financial results was signed by Murthy on behalf of the company, thereby violating the listing agreements under SCRA. happened. ,
Accordingly, the market watchdog imposed a fine of ₹2 lakh on BPML.
However, this penalty will be subject to the outcome of the SEBI appeal pending before the Supreme Court. Section 23E in SCRA deals with the conditions of listing.
Meanwhile, in a separate order, SEBI imposed a total fine of Rs 71 lakh on 35 entities for violating market norms in the case of First Financial Services Ltd.
The order came after SEBI examined trading and dealing in shares of First Financial Services Ltd and noticed unusual fluctuations in share price and trading volume on BSE during the period May 2012 to March 2014.