Shares of PVC pipes maker dived 20% in just an hour of the opening trade on Monday and were locked in the lower circuit. The National Stock Exchange yesterday said trading in Sanco Industries will resume from today after Securities Appellate Tribunal (SAT) stayed trading restriction imposed on the company. The stock of Sanco Industries fell as much as 19.96% to the 52-week low of Rs 70.95 on the very first day after the trading ban was lifted.
The shares of the company will be moved out of GSM (graded surveillance measures) framework and will be available for trading with effect from 22 August 2017, the exchange said in a circular. The stock of Sanco industries will be allowed to trade in a price band of 20%. The move comes after SAT last week stayed trading restrictions imposed on Sanco Industries, which figured in a list of 331 “suspected shell companies” referred by the government to SEBI.
So far, the tribunal has stayed trading restrictions imposed on a total of 10 companies, including JK Infraprojects and Parsvnath Developers. The appellants had submitted their respective financials, along with other filings, before SAT to establish that they are not shell companies and are in compliance with all regulations.
SEBI, on 7 August, had asked stock exchanges to restrict trading in shares of 331 “suspected shell companies”, some of which have investments by several well-known domestic and foreign investors. Subsequently, the exchanges had moved such stocks to the highest sixth grade of GSM, where the shares are allowed to trade only on first Monday of the month with no upward movement in price, with additional surveillance deposit of 200 per cent of trade value to be deposited by the buyers.
Sebi had received the list of such companies from the corporate affairs ministry and many of the 331 firms are under the scanner of Serious Fraud Investigation Office (SFIO) and the income tax department.