Sebi's blanket ban on shell firms hurts innocent minority shareholders the most

There has been a fallout across the whole market; the issue needs to be cleared up soon

The Securities and Exchange Board of India's (Sebi's) action of freezing trading in the shares of 331 so-called shell companies has hit minority shareholders hard. It was an action taken on the basis of price-sensitive information received from the MCA. However, the action itself was taken in a way that doesn't give shareholders either pertinent information or a chance to make a rational decision to stay invested or exit.

Investigations into the financials of listed companies and into cases of alleged price manipulation are common enough. The normal procedure is to put the charges into the public domain. The company