Sebi confirms stay on 5 firms for violating public shareholding norms

Companies had failed to achieve 25% public holding within Sebi prescribed deadline

The Securities and Exchange board of India (Sebi) today confirmed restraining order against five companies which were not in compliance of Sebi's minimum public shareholding (MPS) norms.

These companies include -- Hindustan Breweries and Bottling, Bombay Rayon Fashions, Gandhidham Spinning and Manufacturing Company, Automobile Products of India and India Sugars and Refineries.

In June 2013 sebi had passed an order against over 100 private sector companies. These companies had failed to achieve a 25% public holding within the Sebi prescribed deadline.

Sebi had frozen the voting rights and certain corporate rights of promoters and directors of the companies. Regulator had additionally warned them of other actions including levy of monetary penalties, initiation of criminal proceedings and restricting the trading activities of related stocks.

The watchdog noted that even after passing of the June 4, 2013 order, these companies have not taken any steps to comply with the MPS requirement.

As per the last disclosed shareholding pattern of the companies, public shareholding of India Sugars and Refineries was 16.08% for the quarter ended March 2015.

Similarly, public shareholding of Gandhidham Spinning and Manufacturing Company, Automobile Products of India and Bombay Rayon Fashions stood at 1.18%, 15.29% and 7.9%, respectively for the quarter ended September 2015.