Regulator bans some traders, brokers from trading IPOs

Regulator bans some traders, brokers from trading IPOs
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First Published: Fri, Apr 27 2007. 09 57 AM IST
Updated: Fri, Apr 27 2007. 09 57 AM IST
Saikat Chatterjee, Bloomberg
New Delhi: India’s market regulator banned some brokers and traders from trading on the first day of initial public offerings for manipulating IPOs including Mindtree Consulting Ltd.
The traders placed unusually large orders below the market price for shares of Mindtree Consulting, Pyramid Saimira Theatre Ltd and four other stocks, according to a statement released by the Securities & Exchange Board of India on its Web site late yesterday. Individuals and companies including Latesh Chedda, Viren Kenia, Bhavin Chedda, Chetan Rathod, Neptune Fincot P Ltd, Dhiren Pajwani and RSS Investment Ltd were prohibited from buying or selling shares of companies on the first trading day.
The traders were “artificially enhancing the levels of demand, which constitutes a manipulative practice,” the regulator said in the statement.
The move followed a similar action earlier in the day when the regulator barred some companies with ties to the founders of GHCL Ltd, an Indian chemical maker, from trading shares, saying they artificially boosted volumes. The Securities & Exchange Board is increasing oversight as India’s two biggest markets sell shares to investors including Goldman Sachs Group Inc., the NYSE Group Inc. and Singapore Exchange Ltd.
The benchmark Sensitive Index more than doubled in the past two years as overseas investors bought a net $18.4 billion (Rs75,568 crore) of stocks and other securities.
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First Published: Fri, Apr 27 2007. 09 57 AM IST
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