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SEBI Chairperson Asks Auditors To Use Third Party Validation

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According to Madhabi Puri Buch there exist more than 20 websites in the country which can be used by the auditors to validate the claim of the auditee. Tools such as GSTN portal, bank websites etc. can be used by the auditors for doing a third-party validation

The chairperson of Securities and Exchange Board of India (Sebi), Madhabi Puri Buch asked the auditors to use technology-driven third-party validation for the auditing process in order to check fraud, on 24 November.

While addressing an event organised by the Indian Audit and Accounts Department, Buch said that the commitment to ensure a true and fair picture of whatever is presented in the markets drives the SEBI’s thrust on third-party validation.

According to her there exist more than 20 websites in the country which can be used by the auditors to validate the claim of the auditee.

She said that, when the fraudsters can use technology as a tool, we can use the same technology to evade fraud. Tools such as GSTN portal, bank websites etc. can be used by the auditors for doing a third-party validation.

Auditors are considered as free consultants by the Buch. For disclosure of any document, one needs to check factors such as errors, omission, distortion of the context, denial, minimising, exaggeration, fabrication, Buch added.

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Blackstone To Raise 500 Million Dollar, Plans Listing REIT

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Expectedly the entity may file a draft prospectus with SEBI (Securities and Exchange Board of India) for an Initial Public Offer of India’s first retail real estate investment trust (REIT), Nexus Select Trust or Nexus, partnering with Select Citywalk, Delhi

Blackstone Group is planning to raise nearly 500 million dollar by selling units in the nation’s first retail real estate investment trust (REIT) to institutional and retail investors, revealed a regulatory filing.

Expectedly the entity may file a draft prospectus with SEBI (Securities and Exchange Board of India) for an Initial Public Offer of India’s first retail REIT, Nexus Select Trust or Nexus, partnering with Select Citywalk, Delhi. Blackstone Group is behind India’s maiden REIT.

As compared to any other mall in India, this mall generates the highest tenant sales per sq ft.

The retail assets for this REIT of the US-based private equity major’s portfolio accounts around Rs 23,000 crore or more. Considering the proposed REIT, Blackstone will now own 60 per cent, followed by which Select City will own nearly 25 per cent and the remainder will fall in the bucket of small shareholders.

According to an official, currently India is going through a strong consumption tailwind driven by a growing middle class. As the overall governance is creating a transparent structure and is also tax efficient, the entity was seen bullish on the REIT asset class.

Nexus Malls, India’s is one of the largest retail real estate platforms has 17 malls in 14 major cities. It is the wholly-owned retail properties subsidiary of Blackstone. Nexus Malls owns and operates nearly 10 million sq ft of Grade A retail space in the country, in a short span of five years.

The global investor is planning the listing of its retail assets’ REIT against the backdrop of rising consumption levels, favourable demographics and aspirational brands in the country.

The Indian retail market is under-penetrated with only 13 per cent organised retail against 86 per cent in the US. Brick and mortar retail and ecommerce continue to capture market share from unorganised retail and is expected to witness a 23 per cent CAGR from FY23E to FY25E.

law

SEBI Impose Ban On Mehul Choksi From Markets For 10 Years

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Mehul Choksi was using front entities to manipulate the company’s shares, which resulted in him getting barred from dealing in the market. The regulator alleged the entities taking positions, both in cash and derivatives segments, in the scrip of Gitanjali Gems, acted as fronts on Choksi’s behalf

The Securities and Exchange Board of India (SEBI) has banned businessman Mehul Choksi, from the securities market for a period of 10 years, imposing a penalty of Rs 5 crore. Choksi was using front entities to manipulate the company’s shares, which resulted in him getting barred from dealing in the market. He is former chairman and managing director of Gitanjali Gems (GGL).

Earlier, during the period from 18 July 2011 to 25 January 2012, SEBI had conducted an investigation into trading activities of certain entities in the shares of Gitanjali Gems. The investigation revealed that in total 21 suspected entities were connected to each other through common telephone numbers, common addresses, common e-mail IDs and transfer of funds. 

The regulator alleged the entities taking positions, both in cash and derivatives segments, in the scrip of Gitanjali Gems, acted as fronts on Choksi’s behalf. It further added that such front entities were controlled and managed by a former employee of the company along with few family members. 

After analysing the bank statements of Gitanjali Gems and suspected entities, the company was found transferring and receiving funds from all such suspected entities through layering. Either to meet the margin obligations toward brokers, these amounts were utilised or that they belonged to pay-outs received from exchanges and were transferred back to the company, according to SEBI.

The regulator said that Mehul Choksi’ bank account with ICICI Bank reflected that there were regular transactions of huge amounts to and from the GGL’s bank account. Hence considering the allegations, it was discovered that Mehul Choksi was authorising the transactions made from the account of Gitanjali Gems, which involved movements of funds through layering to meet margin obligations of the front entities toward the brokers.

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Piramal Pharma Lists On Stock Exchanges After Demerger

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Last week, Piramal Pharma said that it has received an approval from the Securities and Exchange Board of India (Sebi) to list shares on the stock exchange

Shares of Piramal Pharma (PPL) were listed on stock exchanges on Wednesday after a demerger from Piramal Enterprises (PEL).

The shares were listed at Rs 201.8 apiece on the BSE, while on the NSE trading started at Rs 200 per share.

Last week, Piramal Pharma said that it has received an approval from the Securities and Exchange Board of India (Sebi) to list shares on the stock exchange.

NCLT had approved the demerger of Piramal Enterprises’ Pharma business in August.

As part of the demerger scheme, four full paid-up equity shares of PPL of Rs 10 each to be issued to PEL shareholders for every one fully paid-up equity share in PEL with a face value of Rs 2 each held by them.

The demerger from PEL will firmly empower PPL to be future ready and enable it to independently pursue its growth strategies with sharper focus and identity, the company said.

The board of the company had approved the demerger of the Pharma business and the simplification of the corporate structure in October 2021.

Piramal Enterprises shares started trading ex-pharma business on Tuesday, 30 August, 2022. The company fixed September 1, as the record date for the demerger of Piramal Pharma.

IPO

SEBI Suspends Go Digit General Insurance’s IPO Proposal

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Go Digit had submitted documents for the IPO with the capital markets regulator on August 17. Cricket player Virat Kohli and his wife Anushka Sharma are among those who have invested in the company.

Capital market regulator SEBI has stopped the processing of IPO application of Virat and Anushka’s investment company, Go Digit.

The capital market regulator SEBI has suspended the Canada’s Fairfax Group backed Go Digit General Insurance’s proposal for Initial Public Offering (IPO). However, the Securities and Exchange Board of India (SEBI) has not given any details about this.

Go Digit had submitted documents for the IPO with the capital markets regulator on August 17. Cricket player Virat Kohli and his wife Anushka Sharma are among those who have invested in the company.

According to the documents submitted regarding the IPO of Go Digit, the company will issue fresh equity shares of Rs 1,250 crore under the IPO and the promoter and existing shareholders will put up 10.94 crore equity shares for sale offer. At the same time, the company will use the amount raised through new equity shares issued under the IPO for building capital base, general company purposes and other functions.

As per information available on SEBI’s website, the regulator has suspended the processing of Go Digit’s IPO application without disclosing the reasons. The company provides other insurance products including Auto Insurance, Health Insurance, Marine Insurance, Asset Insurance. 

Apart from this, SEBI has approved the IPO of Inox Green Energy and with this, the dilemma of approval of IPO of Biba Fashions has also been eliminated. SEBI will now proceed with the processing of the IPO.

IPO

Vaibhav Jewellers Submits Draft Papers For IPO

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On an aggregate basis, the company would invest Rs 12 crore in capital expenditure for the eight retail shops and Rs 160 crore in inventory

Manoj Vaibhav Gems ‘N’ Jewellers Ltd, popularly known as Vaibhav Jewellers, has submitted drafting documents to the Securities and Exchange Board of India (SEBI), in order to generate money through a public listing.

In the initial public offering (IPO), the company’s current promoter Grandhi Bharata Mallika Ratna Kumari would issue 210 crore rupees worth of new shares and make an offer to sell up to 4.30 million of those shares (HUF). Currently, Grandhi Bharata Mallika Ratna Kumari (HUF) owns 75.10 percent of the business.

Elara Capital and Bajaj Capital are the issue’s primary managers. The revenues of the offering will be utilised to fund the establishment of eight showrooms. On an aggregate basis, the company would invest Rs 12 crore in capital expenditure for the eight retail shops and Rs 160 crore in inventory.

Vaibhav Jewellers is a South Indian ethnic jewellery company. The firm has a 5 percent market share of the entire Andhra Pradesh and Telangana jewellery industry and a 14 percent market share of the organised market in these two states in FY2021. It plans to build retail showrooms in Andhra Pradesh and Telangana’s Tier 2 and Tier 3 cities in FY23 and FY24.

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Preparations Begin For Tata Group’s IPO Of ‘Tata Play’

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Since 2004, no firm in the Tata group has gone public. That is, it has been 18 years since a Tata group firm went public.

Another firm of Tata Group, one of the major corporate organizations in the country, can now be listed on the stock market. Tata Group’s Tata Sky, which has now changed its name to Tata Play, is set to go public. By the end of the month, SEBI can get the draft documents for the IPO of Tata Play, the satellite television company owned by the Tata Group.

The rumors were out in the month of July that Tata Play’s (previously Tata Sky) initial public offering may happen shortly. In actuality, a lot of investment firms, including Disney, wish to liquidate their holding in Tata Sky. Investors Temasek and Tata Capital want to sell a portion of their ownership position in the firm during the projected IPO, which is a possibility.

As an 80:20 joint venture between Tata Sons and Network Digital Distribution Services (NDDS), Tata Sky began operating in 2004. NDDS is part of Rupert Murdoch’s 21st Century Fox. Disney purchased Fox in 2019; as a result, Tata Sky now has 41.49 percent ownership from Tata Sons and a 9.8 percent share from Disney through TS Investments Ltd.

However, since 2004, no firm in the Tata group has gone public. That is, it has been 18 years since a Tata group firm went public. The IPO of the country’s largest IT industry, Tata Consultancy Services (TCS), took place in 2004, approximately 18 years ago. TCS raised Rs 5500 crore through its initial public offering (IPO).

Sebi

Adani Needs Sebi Nod To Buy Stake In RRPR: NDTV

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NDTV noted that Sebi had on November 27, 2020, restrained founder-promoters Prannoy Roy and Radhika Roy from accessing the securities market. 

New Delhi Television Ltd (NDTV) on Thursday intimated stock exchanges that the Adani Group companies require the approval of markets regulator Sebi to secure 99.5 per cent interests in the promoter vehicle, as its founders are barred from trading in securities markets.

NDTV noted that Sebi had on November 27, 2020, restrained founder-promoters Prannoy Roy and Radhika Roy from accessing the securities market. 

It further prohibited buying, selling, or otherwise dealing in securities, directly or indirectly, or being associated with the securities market in any manner whatsoever for a period of two years, which expires on November 26, 2022, unless pending appeal proceedings were to successfully conclude prior.

In 2009-10, NDTV founders Radhika and Prannoy Roy took a Rs 400 crore loan from VCPL and in exchange issued warrants allowing VCPL to buy 29.18 per cent of the news group.

VCPL, now a wholly-owned subsidiary of Adani firm AMG Media Networks, has exercised warrants to acquire 99.5 per cent stake in RRPR Holdings.

 RRPR in turn holds 29.18 per cent stake in NDTV. Prannoy Roy and Radhika Roy still hold 32.26 per cent stake in the company.

Shares of NDTV hit a 5 per cent upper circuit limit on Thursday at Rs 407.60 apiece on the BSE.

Sebi

Adani Group Gets Sebi Nod For Ambuja Cements

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The Adani Group has made offers of Rs 385 per share for Ambuja Cements and Rs 2,300 a share for ACC

The Adani Group on Friday received market regulator Sebi’s nod for the USD 3.8 billion open offer for Ambuja Cements and ACC, according to media reports citing sources.

The Adani Group has made offers of Rs 385 per share for Ambuja Cements and Rs 2,300 a share for ACC. With an investment of nearly Rs 31,139 crore, together these two open offers might constitute the biggest open offer in corporate Indian history. Indian stock market rules say that acquiring 25 per cent or more of the shares in a local listed firm will trigger a mandatory open offer where minority shareholders can choose to sell their stakes to the new investor at a predetermined price.

ICICI Securities Ltd. and Deutsche Bank AG are advising Adani on the open offer. The deal was also cleared by the Competition Commission of India (CCI) last week.  Holcim in May agreed to sell its 63 per cent stake in Mumbai-listed Ambuja Cements to Adani Group, which said then that it plans to spend about $10.5 billion on the stake purchases and open offer consideration for Ambuja and related entities. The Holcim transaction is set to propel the Adani Group to become India’s second-largest cement producer.

IPO

Sebi Keeps BIBA Fashion IPO In ‘Abeyance’

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Debt payment and general corporate purposes is what the proceeds form this fresh issuance would be used for.

The Securities and Exchange Board of India (Sebi) has kept in “abeyance” Biba Fashion’s proposed initial share sale. Backed by Warburg Pincus and Faering Capital, the ethnic wear stalwart had filed its preliminary papers with the capital markets regulator Sebi on April 12 to raise funds through an initial public offering (IPO).

The issuance of observations, as updated in August 5th 2022, by Sebi implies its go-ahead for an IPO. The draft papers propose that through the promoter and existing investors, the IPO comprises of fresh issuance of equity shares worth Rs 90 crore and an offer for sale (OFS) of 2.77 crore equity shares.

Proposals to offshore shares have been forwarded by promoter Meena Bindra and private equity investors Warburg Pincus-backed Highdell Investment and Faering Capital India Evolving Fund, as a part of the OFS. Debt payment and general corporate purposes is what the proceeds form this fresh issuance would be used for.

Over the years since its inception in 1986, BIBA has emerged as one of the top ethnic wear brand choices for women. The firm is popular for its wide range of products for women, starting from jewellery to fragrances, apart from its apparel range.

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