sebi:WTM/SR/IVD/ID-2/77/04/2015
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Facts / Headnote
Show cause notice dated August 5, 2014 disposed of; no further direction issued as Rikhav Securities is already undergoing prohibition to act as syndicate/sub-syndicate member since July 11, 2011
Provisions invoked
- s. 11
- s. 11B
- s. 12A
- s. 12
- s. 12(3)
Regulations
- Reg. 3
- Reg. 28(2)
- Reg. 3(b)
- Reg. 28
- Reg. 28(3)
Parties
- Rikhav Securities
Holding
All charges against Rikhav Securities for inflating the bid book in the IPO of Vaswani Industries Ltd. as a sub-syndicate member, in violation of Section 12A(a), (b) and (c) of the SEBI Act and Regulations 3(b), 3(d), 4(1), 4(2)(a) and 4(2)(b) of the PFUTP Regulations, are established. No further direction is issued in these proceedings as Rikhav Securities is already undergoing prohibition to act as syndicate/sub-syndicate member since July 11, 2011.
Full text
Page 2 of 16 2.1. SEBI received several complaints from applicants pointing out large scale withdrawals/rejections in the issue, alleging that certain applications were submitted only to artificially inflate the subscriptions in QIB/NII/RII categories with a view to attract and mislead investors. Based on such complaints from applicants alleging deliberate huge withdrawals and rejections after the closure of the IPO of VIL, SEBI, vide Order dated May 26, 2011, inter alia directed detailed investigations in the matter. While the investigations were in progress, SEBI passed the aforesaid
Page 3 of 16 Withdrawals/rejections from its terminal were as high as 71% of the total issue size. The entire bidding (i.e. 100%) under the NII category and 77% of the bidding under the RII category, from the terminal of Rikhav Securities were withdrawn/rejected.
Page 4 of 16 shares as these bids were withdrawn subsequently. Further, of the above, 137 bids for 5,58,960 shares were placed on May 3, 2011 and of which only 76 bids for 3,10,080 shares were valid.
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Source: SecMarx — sebi:WTM/SR/IVD/ID-2/77/04/2015. 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.