Tuesday, October 14, 2014

SEBI banned DLF promoters from securities market

ET reported that Sebi has barred DLF, promoters and few employees from securities markets for three years. And this means that DLF itself will also be prohibited from issuing equities and other instruments such as REITs and debentures.

The reasons SEBI gave for the ban,
- the company is found guilty of "active and deliberate suppression" of material information at the time of its public offer.

This is bad news for the investors and will have a really bad impact on their investment since this will impact the company and retail shareholders far more than it will on the promoters group. Sometimes I feel SEBI need to punish the promoters group running the company far more without affecting the company but it seems the regulations might not be in place to do so.

It looked like that there is indeed a governance issues at this company, since recently there is a number of wrong doings by the company in question,
- Punjab and Haryana High Court's cancellation of 350 acres of land allocation at Wazirabad in Gurgaon and
- CCI's penalty of Rs 630 crore on the company.

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