SEBI Bars 65 from Markets, Asks 27 To Disgorge Unlawful Gains Worth Rs40.23 Crore in Yamini Investment Scrip Manipulation Case
Moneylife Digital Team 05 September 2023
Market regulator Securities and Exchange Board of India (SEBI) has barred 65 entities from markets for two years while directing 27 entities to disgorge unlawful gains worth Rs40.23 crore earned by manipulating the share price of Yamini Investment Ltd. SEBI also imposed a penalty of Rs8 lakh on two entities. According to SEBI, 102 entities connected with Madhur Buildcon Pvt Ltd, one of the promoters of Yamini Investment, traded in the scrip and provided exit at an inflated price to certain shareholders of the company.
In an order, Ashwani Bhatia, whole-time member (WTM) of SEBI, says, "Noticees1 to 67 (other than noticees 26 and 27) are restrained from accessing the securities market and further prohibited from buying, selling or otherwise dealing in securities, directly or indirectly, or being associated with the securities market in any manner, for a period of two (2) years, from the date of this order. Noticees 11, 42 to 67 shall disgorge the unlawful gains totalling Rs40.23 crore."
From 10 September 2013 to 30 September 2015, SEBI observed unusual fluctuations in the price and volume of Yamini Investment. SEBI investigated the scrip to determine whether the price movement was due to normal trades or any act of price manipulation. The investigation period was divided into two patches- the pre-stock split period (10 September 2013 to 18 February 2015) and the post-stock split period (19 February 2015 to 30 September 2015). 
From an analysis of the trading in the scrip on BSE during the investigation period, SEBI found that certain entities trading in the scrip were allegedly connected based on know-your-customer (KYC), off-market transfers, fund transfers and common directors. Initially, two groups of connected entities were identified—a group consisting of 88 entities (Madhur group) and another group consisting of 14 entities (PCB group). Subsequently, inter-se connections were noted between members of the Madhur group and PCB group. Therefore, SEBI's show-cause notice ( SCN) refers to the 102 entities collectively as the Madhur group. 
Mr Bhatia says, "The connections have been sought to be established between the noticees and either Yamini Investment itself or with Madhur Buildcon, which is the promoter of Yamini. In cases where the connection is being made between the noticees and Yamini, the link, I note, has been made through their connections with entities connected to Vandana Agarwal, who was a director of both Yamini and Anax Com Trade Ltd (Anax), one of the amalgamating entities. These connections, I note, have primarily been made based on off-market transfers, common address and contact details appearing in KYC documents, and based on having common directors.”
The SCN has alleged that 14 entities (noticees 1 to 14) had manipulated the price of the scrip during the investigation period. The trading pattern in the scrip was analysed during the investigation, and it emerged that during the pre-stock split period (patch I and patch II), which was also the price rise period, nine out of the top-10 buyers and seven out of the top-10 sellers were part of the Madhur group. It was also noted that the 102 entities of the Madhur group had cumulatively bought 57,884 shares during this period, representing 93.03% of the total market volume, and sold 33,629 shares, representing 50.46% of the total market volume. 
As regards the trading during the post–stock split (19 February 2015 to 30 September 2015), which was also the price fall period, SEBI noted that eight out of the top-10 buyers were part of the Madhur group. When the trading data of the entire group was analysed, it was observed that 102 entities (Madhur group) had cumulatively bought 8,78,83,505 shares, representing 75.46% of the total market buy volume during this period, and sold 1,50,567 shares which amounted to 0.13% of the total market sell volume. 
"It is therefore noted that Madhur group was active on both the buy side and the sell side during the pre-stock split period. During the price fall period, it was noted that Madhur group trades were mostly on the buy side, and sell volumes were negligible when compared to the total market volume. It was also noted that during the price rise phase, 31,391 shares, representing 50.46% of the market volume, were traded between the 102 entities forming the Madhur group," Mr Bhatia says.
The SCN also explained the alleged modus operandi in the price manipulation of Yamini Investment scrip. It says, "The connected entities of the Madhur group (102 entities) traded in the scrip during the investigation and provided exit at an inflated price to certain shareholders of the company. These shareholders had received shares of Yamini Investment pursuant to a preferential allotment made as part of a scheme of amalgamation sanctioned by the Bombay High Court (HC)."
In terms of the scheme of amalgamation, 2,455 shareholders of the two unlisted companies–Anax and Fidelo Power and Infrastructure Ltd (Fidelo) that merged with Yamini Investment—were allotted eight shares of Yamini for every 10 shares held by them in the respective unlisted companies. 
Out of these 2,455 entities, SEBI observed that 1,112 entities had sold allotted shares during the investigation period. "However, only 27 preferential allottees (including one entity, Gopal Bansal (Hindu undivided family-HUF), which was allegedly part of the price manipulation also) whose connections with the Madhur group could be established during the investigation, have been made noticees." 
"I also note that out of 102 entities, allegedly part of the Madhur group who had traded in the scrip during the investigation period, only 14 entities are alleged to have manipulated the price of the scrip and further 29 entities who acted as counterparties providing exit to the shareholders (two entities are common –manipulated the price and also provided exit) have been made noticees," Mr Bhatia says.
SEBI directed 27 entities to disgorge the unlawful gains totalling Rs40.23 crore. It includes, Gopal Bansal (HUF), Sanjeev Goel, Rajni Goel, Satvinder Kaur, Harvinder Singh, Gurupreet Sangla, Amit Khandelwal, Renu Agarwal, Seema Sangla, Ankit Khandelwal, Harvinder Singh (HUF), Kuldeep Kaur, Gyan Prakash Rai, K Ashok Kumar (HUF), K Ashok Kumar, Manju Rai, Ashokkumar Aashish Bohra, Vimala Bohra, Nisha Sharma, Shubhra Khandelwal, Maya Devi Khandelwal, Nidhi Khandelwal, Dropdi Devi, Rajeev Goel (HUF), Hans Raj Agarwal, Ashok Sneha Bohra and Rahul Goel.
The market regulator barred 65 entities from markets for two years. It includes the above-named entities as well as Maheshwari Financial Services Pvt Ltd, Autolite Agencies Pvt Ltd, Toor Finance Company Ltd, Stellar Capital Services Ltd, Premlal Roy, Aries Commercials, Moonlight Udyog, Shri Ram Traders, Chandra Prakash Balkisanji Laddha, Anshu Kataruka, Hetab S Kangad (HUF),  Vindyavasini Agency Pvt Ltd, Mkr Trading Pvt Ltd, Fortunate Infra Developers Pvt Ltd, Linkup Vintrade Pvt Ltd, Omkara Dealer Pvt Ltd, Overall Logistics Pvt Ltd, Dace Exim Pvt Ltd, Imagine Logistics, Natural Investment Management Pvt Ltd, Dhirga Marketing Pvt Ltd, Ecospace Infotech Pvt Ltd, Etricks Enterprises Pvt Ltd, Everblink Agency Pvt Ltd, Headfirst Vinimay Pvt Ltd, Richi Consultants Pvt Ltd, Vighnaharta Infra Developers Pvt Ltd, Veenit Builders Pvt Ltd, Veepra Real Estate Consultants Pvt Ltd, Goodpoint Commodeal Pvt Ltd, Krushana Infra Property Pvt Ltd, Rajputana Digital Mediapvt Ltd, Goldensight Commotrade Pvt Ltd, Surakshit Merchants Pvt Ltd, Surabhi Dealmark Pvt Ltd, Sanshipt Broking And Consultancy Pvt Ltd, Ram Yadav, Nicky Marmo Ltd, Optimal Farms Pvt Ltd and Bij Buildcon India Pvt Ltd.
10 months ago
what about people who suffer loss . give them this money
10 months ago
I think it’s in public interest to know identifiable, exact details of these defaulters.
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