SME woes: Sebi flags fraud by 2 companies to pump up stock


A string of accounting frauds unearthed by Sebi this month poses one other danger to the blistering rally in shares of small companies. Varanium Cloud and Add-Shop E-Retail – each listed on the small and medium enterprises (SME) platform – had been discovered to have manipulated their monetary statements to gas positive aspects of their shares, in accordance to preliminary orders issued by Sebi.The authorities have banned each companies and their founders from dealing within the capital market.
The crackdown comes after the regulator issued warnings earlier this yr of worth manipulation in tiny IPOs. Analysts say the event presages better regulatory motion, which can mood additional positive aspects within the BSE SME IPO Index of micro listings that has soared greater than 5,000% for the reason that begin of 2021.
“This is just the tip of the iceberg,” mentioned Ambareesh Baliga, a market professional. “Fewer regulations were meant to attract good quality SMEs to the market… instead it has attracted the wrong ones.”
Technology agency Varanium Cloud was discovered to have misused funds raised from its public providing in 2022, and (*2*), Sebi mentioned in its order dated May 10.

Nilesh Desai
Nilesh Desai
The Hindu Patrika is founded in 2016 by Mr. Nilesh Desai. This website is providing news and information mainly related to Hinduism. We appreciate if you send News, information or suggestion.


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