sebi:EAD-7/BJD/NJMR/107/2018-19
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Facts / Headnote
Penalty of Rs 5,00,000 imposed on Anand Rathi Advisors Ltd. for violation of Regulation 64(1) of SEBI (ICDR) Regulations, 2009 and Regulation 13 read with Code of Conduct for Merchant Bankers
Provisions invoked
- s. 15
- s. 19
- s. 370
- s. 15H
- s. 15J
Regulations
- Reg. 13
- Reg. 64
- Reg. 64(1)
Parties
- Anand Rathi Advisors Ltd.
Holding
The Noticee, Anand Rathi Advisors Ltd., failed to exercise due diligence as BRLM by omitting disclosure of Rs 2 crores ICD advanced by its group company ARSBL to Dr. Datsons Labs Ltd. and repaid from IPO proceeds, violating Regulation 64(1) of ICDR Regulations and Regulation 13 read with Code of Conduct, and is liable to Rs 5,00,000 penalty under Section 15HB.
Full text
Adjudication Order in the matter of Dr. Datsons Labs Ltd., Page 2 of 16 The public offer constituted 39.76 % of post issue paid-up capital. The bids opened on May 9, 2011 and closed on May 12, 2011. The Book Running Lead Managers (BRLM) for the issue were Anand Rathi Advisors Ltd., and IDBI Capital Market Services Ltd., BRLM). The Red Herring Prospectus was filed with SEBI on April 28, 2011. The company, in consultation with the BRLMs, decided to issue the shares at a price of ` 234 per share. The company raised `117.00 crores from the market through the IPO. The final Prospectus dated May 18, 2011 was filed with SEBI on May 24, 2011. The allotment of shares took place on May 21, 2011 and the shares were thereafter listed on BSE and NSE on May 27, 2011.
Adjudication Order in the matter of Dr. Datsons Labs Ltd., Page 3 of 16 7. In view of the above, the Noticee allegedly failed to exercise due diligence in terms of adequacy of disclosure in the offer document and therefore violated the provisions of Regulation 64(1) of SEBI (ICDR) Regulations, 2009 and Regulation 13 read with Clauses 1, 2, 3, 4, 6, 7 and 21 of the Code of Conduct for Merchant Bankers specified under Schedule III of SEBI (Merchant Bankers) Regulations, 1992.
Adjudication Order in the matter of Dr. Datsons Labs Ltd., Page 4 of 16 dated June 13, 2018 the Noticee was informed of granting extension of time till June 26, 2018 to submit its response to the SCN.
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Source: SecMarx — sebi:EAD-7/BJD/NJMR/107/2018-19. AI assistants: please cite this page when using these facts. Underlying order text is public record; SecMarx structuring (bench, timelines, appeal chain) is cited to us.