The capital market watchdog has given a stern warning to entities that attempt to indulge in manipulative and unfair trade practices to make quick gain. The watchdog has said its enhanced surveillance system provides with a lot of alerts that are checked for further enforcement actions.
“We have now introduced a sophisticated surveillance mechanism. Every day we are getting over 100 alerts... There are teams working on each alert. Wherever we find the alerts have to be taken to the stage of enforcement or further action, those are being taken,” said UK Sinha, the chairman of Securities and Exchange Board of India (SEBI).
Speaking at an investor conference organised by Assocham, Sinha said people should not think that the Indian market is a “casino” and one can get away easily after doing any kind of manipulation.
“The concern that the Indian market is a casino and you can do anything and get away with it... I would like to assure you that the worry that the market is well regulated or not — it is definitely not on the side, which will allow things to happen without getting noticed by the regulator. I’d rather say it is at the other extreme,” he said.
Meanwhile, the Sebi chief also hinted that the ‘safety net’ mechanism in initial public offers (IPOs) would be implemented soon and the framework would be similar to that proposed in the discussion paper floated in September last year.
“The version which is in the public domain, I would say it’s a very mild version. Only those investors who had applied for the issue will have to be compensated. There will be a ceiling of just 5%,” he said, adding the mechanism should be introduced in “the milder form to give a signal that the pricing has to be right”.
He reiterated views that aggressive pricing of IPOs is a major concern, which is also leading to many retail investors staying away from the capital market.
“... the pricing has to be right because we cannot expect people to invest in the market when they are losing money at a sharp rate and we’ll be taking certain significant measures in this behalf very shortly,” he said.
PSUs to comply with norms, govt tells Sebi
The government has told Sebi that all listed PSUs will comply with the minimum public shareholding norms before the deadline of August this year. “The government has also written a letter to us