Fund houses jump ship ahead of ICICI Securities rout: All you need to know

Immediately after the lock-in period ended in April, certain fund houses have managed to escape the rout that shares of ICICI Securities witnessed in the light of Sebi’s scrutiny over its IPO. Certain fund houses managed to sell as many as 1.46 million shares in May, booking losses between 20 and 30 per cent. 

ICICI Securities is currently trading at 40 per cent below its issue price of Rs 520. The IPO of the broking and investment banking arm has been under scrutiny for quite some time now. The market regulator has found ICICI Prudential MF guilty of violating the MF code of conduct while bidding for the shares of ICICI Securities on the last day of the initial public offer. Accordingly, the fund house has been directed to refund Rs 2.4 billion with an annual interest of 15 per cent to five schemes of the mutual fund which invested in the IPO.  The regulator has also ordered compensating investors who redeemed their units since the date of allotment of shares in IPO.