 "Suspected shell company Prakash Industries zooms 208% in 2017")
Prakash Industries, Parsvanath Developers and J Kumar Infraprojects are among 331 companies that the market regulator banned trading, have rallied by up to 208% during the current calendar year 2017 (CY17).
The Securities and Exchange Board of India (Sebi) has directed stock exchanges to initiate action against 331 firms that it suspects are shell companies and are listed on the bourses.
Trading in all such listed securities, Sebi said, shall be placed in Stage VI of the Graded Surveillance Measure (GSM) with immediate effect. If any listed company out of the said list is already identified under any stage of GSM, it shall also be moved to GSM stage VI directly, the order says.
ALSO READ: Sebi bans trade in suspected shell companies. Here is the full list
Among individual stocks, Prakash Industries had zoomed 208% from Rs 45.20 to Rs 139 thus far in CY17. Parsvanath Developers and J Kumar Infraprojects surged 82% and 38% respectively, as compared to 21% rise in the S&P BSE Sensex till Monday.
Among the public shareholders, Foreign Venture Capital Investors hold 7.5% stake, while BNB Paribas Arbitage hold 3.4% stake in Prakash Industries as on June 30, 2017. Rakesh Jhunjhunwala too holds 1.5 million equity shares of 1.01% stake in the company, shareholding pattern data show.
PRAKASH INDUSTRIES DENIES CHARGES
Post Sebi’s move, Prakash Industries said that it is not a “shell company” as alleged.
The Securities and Exchange Board of India (Sebi) has directed stock exchanges to initiate action against 331 firms that it suspects are shell companies and are listed on the bourses.
Trading in all such listed securities, Sebi said, shall be placed in Stage VI of the Graded Surveillance Measure (GSM) with immediate effect. If any listed company out of the said list is already identified under any stage of GSM, it shall also be moved to GSM stage VI directly, the order says.
ALSO READ: Sebi bans trade in suspected shell companies. Here is the full list
Among individual stocks, Prakash Industries had zoomed 208% from Rs 45.20 to Rs 139 thus far in CY17. Parsvanath Developers and J Kumar Infraprojects surged 82% and 38% respectively, as compared to 21% rise in the S&P BSE Sensex till Monday.
Among the public shareholders, Foreign Venture Capital Investors hold 7.5% stake, while BNB Paribas Arbitage hold 3.4% stake in Prakash Industries as on June 30, 2017. Rakesh Jhunjhunwala too holds 1.5 million equity shares of 1.01% stake in the company, shareholding pattern data show.
PRAKASH INDUSTRIES DENIES CHARGES
Post Sebi’s move, Prakash Industries said that it is not a “shell company” as alleged.
“We are not a company which can by any stretch of imagination be termed as such and we are a healthy profit making company having an annual turnover of Rs 2,400 crore and profit of Rs 78 crore during the last year (FY2016-17),” Prakash Industries said in a letter to Sebi.
The company said it has paid more than Rs 675 crore as excise duty and income tax in the last three years. It is therefore clear that the direction is misconceived and the data collected by the MCA is totally incorrect.
That under the circumstances we call upon you to forthwith withdraw such directions qua our company and same be placed under normal trading as was being done, it added. CLICK HERE TO READ FULL RELEASE
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