 "IIFL Securities plunges 18% as Sebi bans for onboarding new clients for 2 years")
Shares of IIFL Securities plunged 18 per cent to Rs 58 on the BSE in Tuesday’s intra-day trade amid heavy volumes after the market regulator the Securities and Exchange Board of India (SEBI) barred the company from onboarding new clients for two years.
The SEBI has prohibited the company from onboarding new clients for a period of two years in respect of its business as a stock broker, IIFL Securities said in an exchange filing.
This order has been issued in connection to finding the mixing of clients funds with proprietary funds. Such an order could keep stock under pressure as it will impact business growth and thus earnings trajectory, ICICI Securities said in a note.
Meanwhile, IIFL Securities said the Order does not affect company’s existing business with the existing clients. The company is in the process of preferring an appeal against the said Order before Securities Appellate Tribunal.
Further, the company said it has always met all its obligations towards exchanges and clients on time. The company has always followed a Compliance First approach and carried out business in full compliance in letter and spirit with extant laws and regulations, it added.
At 10:11 AM; IIFL Securities quoted 12 per cent lower at Rs 62.53, as compared to 0.41 per cent decline in the S&P BSE Sensex. The average trading volumes on the counter jumped over four-fold today. A combined 6.5 million shares changed hands on the NSE and BSE. Till Monday, the stock had rallied 20 per cent in the month of June.
