Fraser and Company, Promoters Penalised Rs5 Lakh by SEBI for Regulatory Violations

Moneylife Digital Team 15 May 2025

Investor Interest

Market regulator Securities and Exchange Board of India (SEBI) has imposed a penalty of Rs5 lakh on Fraser and Company Ltd (noticee 1) along with Yogeeta Shivhare (noticee 2) and Omkar Shivhare (noticee 3), both promoters, as well as on Ekadanta Genex Pvt Ltd (Noticee 4) from the promoter group and Alpha Leon Enterprises LLP (noticee 5). The adjudication proceedings were initiated after an investigation found non-compliance with disclosure requirements under the SEBI Act, 1992, and related regulations.

In an order, Amit Kapoor, the adjudicating officer (AO) of SEBI, states: "I cannot ignore that compliance with the applicable provisions of the SAST Regulations, as mentioned in this case, was mandatory. SEBI has a duty to ensure these regulations are followed. In my opinion, under a disclosure-based regime, the key factor is timely disclosure. Any delay or compromise in this can threaten the orderly functioning of the securities markets and may lead to a loss of investor confidence in the market’s integrity."

SEBI examination found that Fraser and Company made misleading disclosures regarding two work orders, overstating a Rs5.45 crore order as Rs15 crore from Shraddha group and falsely reporting a Rs10 crore order from Sai Siddhi Developers. These actions violated Regulations 4(1)(c), 4(1)(d), and 4(1)(e) of the LODR Regulations. The company failed to update the stock exchange about the true status of these orders, which were later admitted to be from previous management or non-existent, SEBI says.

In addition, promoters and related entities, the Shivhares, along with Ekadanta Genex, were found guilty of delayed disclosures related to multiple share sale transactions between December 2021 and January 2022. For instance, the promoters sold 316,235 shares, representing 3.89% of the company’s share capital, between 17th December and 21 December 2021. Although the initial disclosure was made on 22 December 2021, errors led to a corrected disclosure only on 12 January 2022, resulting in a 20-days delay.

Similarly, the promoters sold 163,079 shares or 2.01% of share capital between 24th December and 27 December 2021, with a corrected disclosure delayed by 14 days. Sales amounting to 310,454 shares on 28th December and 30 December 2021, were also disclosed late after trade settlements triggered revised deadlines. These delays and errors breached Regulation 29(2) of the SEBI (Substantial Acquisition of Shares and Takeovers) Regulations, 2011 (SAST Regulations).

Further, Alpha Leon Enterprises violated disclosure norms under Regulation 29 of the SAST Regulations by failing to disclose one acquisition and two sales of shares on time. Alpha Leon Enterprises acquired 843,926 shares, accounting for 10.39% of the company’s share capital on 11 January 2022, which required disclosure by 13 January 2022. Furthermore, Alpha Leon Enterprises sold shares totalling over 10% of the share capital in multiple transactions between 11th January and 17 January 2022, but failed to make timely disclosures, establishing violations under Regulation 29(1) and 29(2) read with Regulation 29(3).

The combined findings of incorrect disclosures, delays and misleading information led SEBI to impose a penalty of Rs1 lakh each on Fraser and Company and the four associated entities.

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