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SEBI puts brake on Vaswani Industries listing

20 May 2011 Evaluate

The listing of Vaswani Industries’ initial public offer (IPO) has been withheld by the capital market regulator Securities and Exchange Board of India (SEBI) after receiving complaints regarding irregularities in subscription. The regulator has advised the stock exchanges to withhold the listing of securities until further instructions. Meanwhile, inquiries into the matter are in progress and based on the findings, appropriate action would be taken.

The IPO of Vaswani Industries, which opened on April 29, 2011, was subscribed four times on the final day of the issue. The company offered one crore shares at a price band of 45-49, and after the issue was subscribed over four times, the merchant banker to the issue, Ashika Capital, fixed the price at 49. According to merchant banking officials, close to 3,200 applications were withdrawn by investors, most of which were retail applicants. After the withdrawal, the subscription amounted to only around 1.3 times. The bankers said that applications were disqualified after the issue was closed. Investors, who received a higher allotment of shares than what they had applied for complained to the regulator of irregularities.

Vaswani Industries is engaged in the integrated business of manufacturing sponge iron, steel billets and ingots and power generation.

Vaswani Industries Share Price

58.65 -1.77 (-2.93%)
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