Shankar Sharma portfolio stock Brightcom Group hits lower circuit on 8th consecutive day

Brightcom Group share price: On a monthly scale, Brightcom Group shares fell 20 per cent in July and 33 per cent in August. On the first day of September today, the stock continued its losing streak, falling 5 per cent.

Nishant Kumar
Updated1 Sep 2023, 02:26 PM IST
Brightcom Group shares have been falling for the last eight sessions. AFP PHOTO/ Indranil MUKHERJEE
Brightcom Group shares have been falling for the last eight sessions. AFP PHOTO/ Indranil MUKHERJEE(AFP)

Brightcom Group share price was locked in its lower circuit as the stock opened at its 5 per cent lower price band of 16.08 on BSE on Friday. Shankar Sharma portfolio stock Brightcom Group has been hitting the lower circuit for the last eight consecutive sessions. On a monthly scale, the stock fell 20 per cent in July and 33 per cent in August. On the first day of September today, the stock continued its losing streak, falling 5 per cent.

Why is Brightcom Group share price falling?

The stock has been falling after market regulator Securities and Exchange Board of India (SEBI) issued an interim order raising concerns over the found lapses in the preferential issue of the company. SEBI has barred Suresh Kumar Reddy - the promoter-cum-chairman and managing director of Brightcom Group, along with chief financial officer Narayan Raju from holding directorial posts until further notice.

Read more: SEBI finds lapses in Brightcom's preferential issues of shares; top officials barred from holding directorial posts

Besides, the capital market regulator barred ace investor Shankar Sharma and 21 other individuals from offloading their shareholding in the company. According to the shareholding pattern of Brightcom Group for the April to June 2023 quarter, Shankar Sharma held 2.30 crore company shares, which was 1.14 per cent of the total paid-up capital of the company.

Hyderabad-based Brightcom had problems with the market regulator before too, including concerns over overstating profits in its financial documents.

In June, SEBI levied fines totalling 40 lakh on Brightcom Group and its promoters for flouting regulatory norms. The regulator imposed a fine of 12 lakh on Geetha Kancharla, 6 lakh each on Vijay Kumar Kancharla HUF, Vijay Kumar Kancharla, Karta of HUF and M Suresh Kumar Reddy (Chairperson and MD) and 5 lakh each on S V Rajyalaxmi Reddy and Brightcom Group Ltd.

SEBI conducted an examination of the matter of the media company to ascertain the violation of provisions of insider trading norms, if any, by certain entities while trading in the shares of the company from April 2020 to August 2021.

In its examination, the regulator found that Vijay Kumar Kancharla HUF, M Suresh Kumar Reddy, S V Rajyalaxmi Reddy and Geetha Kancharla traded in the scrip of BGL from April 2020 to August 2021.

Meanwhile, the Enforcement Directorate (ED) on Saturday (August 26) conducted searches under the provisions of FEMA, 1999 at 5 locations in Hyderabad at the residences of Brightcom Group Ltd’s CEO and CFO, and premises of the company’s auditor P Murali Mohana Rao, according to ED's official account on the X platform.

During the search, various incriminating documents, digital devices, unaccounted cash of 3.30 crore and gold jewellery and bullion worth 9.30 crore from the residence of auditor, P. Murali Mohana Rao were recovered and seized, ED said on Saturday.

Read more: ED conducts searches at Brightcom Group's CEO, and CFO residences in Hyderabad today; seizes cash, gold and bullion

After Brightcom's board meeting on August 27, the company informed its Chairman and Managing Director Suresh Reddy had resigned from his position. The company's Chief Financial Officer Narayana Raju also resigned.

Technical views on Brightcom Group share price

Jigar S. Patel, Senior Manager of Equity Research at Anand Rathi Share and Stock Brokers observed that on August 23, 2023, the stock broke the lower band of Bollinger band along with the Ichimoku cloud break which triggered further weakness in the counter and is currently placed at 16.15 levels.

"As we advance, support is seen near 14.5 followed by 12.5. Since this counter is trading below all major exponential averages, further weakness could be seen. Fresh buy is not advised at the current juncture," said Patel.

Brightcom Group technical chart

Vaishali Parekh, vice president of technical research at Prabhudas Lilladher said the stock has witnessed an erratic chart pattern with a series of lower circuits so, little technical judgment can be made for this stock.

"The near-term support visible is near 14 level as per the previous bottom made," said Parekh.

Read all market-related news here

Disclaimer: The views and recommendations above are those of individual analysts and broking companies, not of Mint. We advise investors to check with certified experts before making any investment decisions.

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First Published:1 Sep 2023, 02:26 PM IST
HomeMarketsStock MarketsShankar Sharma portfolio stock Brightcom Group hits lower circuit on 8th consecutive day

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