Brazen price manipulation, stock cornering, fabricated financial disclosures and social media influencers fuelling pump-&-dump schemes—this is the alarming new reality of India's capital markets. A growing network of operators, working with absolute impunity, has been executing these schemes, drawing in unsuspecting retail investors.
After hundreds of investor complaints, the Securities and Exchange Board of India (SEBI) issued three interim orders in the past few months exposing how a cabal of operators had cornered almost the entire shareholding of listed shell companies to artificially inflate prices. The market-capitalisation of three entities—Bharat Global Developers Ltd (Bharat Global), LS Industries and Pacheli Industrial Finance—soared to over Rs23,000 crore on the back of fictitious business claims. SEBI’s intervention has halted trading in these cases and, possibly, saved many investors; but investigators suggest this is just the tip of the iceberg. Here is the bizarre story of just one of these three entities.
The stock of Bharat Global, ostensibly in IT hardware and global trade, climbed an astronomical 105-fold from Rs16 in November 2023 to Rs1,702 by November 2024. Before this, the stock had been suspended for a long time due to non-payment of listing fees. The meteoric rise was preceded by hectic corporate restructuring, multiple name changes and a series of preferential allotments at steep discounts—effectively concentrating 99.5% of shares with 41 new allottees. Despite negligible sales and dubious financials, the company issued fictitious reports of high-value orders from leading firms such as McCain India Agro, UPL Agro and Tata Consumer Products. It also claimed an order from Reliance Industries, but more about that later. These claims created a plausible cover for stock ramping.
However, in December 2024, SEBI intervened, suspending trading due to financial misrepresentation, misleading disclosures, price manipulation and share offloading at inflated rates. The regulator also froze Rs271.6 crore in illegal gains and imposed restrictions on company officials and preferential allottees (Read: SEBI Halts Trading in Bharat Global Developers Over Financial Misrepresentation & Market Manipulation).
Unfazed by the action, Bharat Global appealed to the securities appellate tribunal (SAT), claiming it had a new management in place and should be allowed to resume trading. On 19 March 2025, SAT directed SEBI to “examine the profile of the new management/directors before 31st March and if they are found fit, the trading shall be permitted.” This strange order effectively strong-armed the regulator to certify the ‘new’ management’s legitimacy within just 10 days—a troubling precedent that could encourage further market manipulation, but has not elicited any media discussion.
SEBI responded on 26th March with a confirmatory order which refused to get into the ‘fit and proper’ aspect but confirmed fake disclosures and false claims by the company. SEBI also said that trading could resume on 15th April subject to the company declaring provisional financial numbers for FY24-25 (including sales, purchases, gross profit, net profit and net worth). This is not going to be easy.
Then, on 27th March, Bharat Global admitted in an exchange filing that it had no evidence of the massive orders it had previously touted—except one from Reliance. The filing also contained an unusual cautionary note advising investors to “to exercise due diligence and take informed investment decisions.”
Strangely, the company's management remains a mystery. Whistle-blowers allege that the preferential allotments were directed to market operators who dumped all the shares leading to nearly 100% public holding. Mohsin Shaikh is listed as the chief executive officer (CEO) and the company has told SEBI that three previous directors—including managing director (MD) Ashok Sewda—have been asked to resign as part of management restructuring after SEBI’s interim order. The company's disclosures are vague, with even the official inquiry email ([email protected]) to which I addressed queries remaining unanswered. The stock exchange disclosure is signed by one Keyurkumar Pravinbhai Patel who is apparently part of the new management.
SEBI’s whole-time director (WTM), Ashwini Bhatia, makes some telling observations in his confirmation order. He writes, the sequence of events and actions “leads us to the conclusion that there are certain individuals who could be controlling the affairs of Bharat Global and who enjoy the power to change its management at their discretion.” Also, “contrary to claims made before SAT,” the company has not provided SEBI with details of the new management other than Keyurkumar Patel.
The order goes on to say that Bharat Global has not submitted any ‘meaningful responses’ to multiple SEBI summons nor provided information on key management persons running the company and making business decisions.
Influencer Marketing
Let’s now look at the pump-&-dump operation. Bharat Global’s price surge would have been impossible without a well-coordinated social media campaign using paid influencers and social media platforms. A whistle-blower has provided me with detailed documents showing that a Gujarat-registered shell company, ostensibly in the steel business, funnelled Rs45 lakh (including goods and services tax -- GST) to a leading influencer management agency to orchestrate Bharat Global’s market manipulation. The campaign engaged 23 influencers on Twitter (X), seven YouTube creators, and three Instagram influencers to pump up the stock.
The data with details of discussions with specific influencers has been shared with the regulator, who has the power to call for information nail the operation. Interestingly, most of the influencers are not SEBI registered and naïve enough to believe that a disclosure (“not SEBI registered”) and disclaimer (“do your own investigation” and “this is not a buy-sell recommendation”) will protect them from regulatory action.
Many of the posts by these influencers are still online and match the chat data provided to me by whistle-blower, although some reels have been deleted. They pitched the stock as a multi-bagger that could go to Rs5,000. All this raises several questions, even as SEBI’s investigation continues.
1.Is there a larger, well-connected syndicate orchestrating pump-&-dump schemes and funding appeals against regulatory orders?
2.Will SAT’s order compelling SEBI to certify a new management’s legitimacy and order resumption of trading despite such serious allegations become a precedent?
3.Even if such certification were remotely feasible, isn’t it the domain of the ministry of corporate affairs?
4.Why didn’t McCain India Agro, UPL Agro and Tata Consumer Products deny Bharat Global’s false claims, when mainstream media amplified them? Most companies have dedicated teams monitoring their online mentions.
5.The order from Reliance Industries is more mysterious. Reliance admitted to placing a Rs155 crore order with Bharat Global and even paid Rs65 crore upfront without an invoice. What was Reliance’s business connection with such a dubious entity and whose management seems unclear?
Bigger Picture: More Cases Emerge
Bharat Global is not an isolated case. SEBI has recently clamped down on two similar schemes:
LS Industries’ stock rocketed 1,089% from Rs22.50 to Rs267.50 within two months of its trading suspension being lifted in July 2024. The stock later crashed following a massive sell-off in November 2024. Its financials and modus operandi is similar to Bharat Global (Read: Interim Order in the matter of LS Industries Limited)
The ongoing investigations suggest that many others may still be flying under the radar. The ease with which market manipulators can dupe investors, manipulate share capital and management decisions underscores the urgent need for stricter enforcement against fraudulent market practices without SEBI being hobbled in its attempts to stop them.
Why is SEBI not naming the influencers, they are as much a part of this whole racket, because they are misguiding investors. They should be fined and their social media posts/ webpages/ Telegram groups/ Whatsapp groups should be shut down immediately.
Time to follow the Singapore model. Let everything come under the ambit of the police and BNS laws. SEBI is not required. Why have another layer of regulation and bureaucracy when one set of laws is sufficient for everything? The more regulation and laws you add over an existing layer, the more room it gives to offenders (especially repeat ones) to take advantage of an already flawed judicial system and ineffective state machinery (not to mention confusing overlap of laws and legal nonsense). Anyway, I'm not surprised this happens routinely. The system is the problem. It's very easy to game it.
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