Mukta Arts, Balaji Tele, 12 others back to weekly settlement on BSE

Virendra Verma & Laxmikant Khanvilkar

Mumbai, Aug 26: In a surprise move, the Bombay Stock Exchange (BSE) on Saturday announced shifting of two hot media stocks Balaji Telefilms and Mukta Arts back to the normal weekly settlement from the prevailing trade-to-trade (TTT) segment from Monday. In addition, the exchange has moved 12 other scrips to the weekly settlement from TTT.

Other scrips brought back to the weekly settlement are -- Fourth Generation Information System, Gravity (India), Prudential Pharmaceuticals, Sword & Shield Pharma, Toubro Infotech & Industries, E.Star Infotech, Genius Commu Trade, Rinki Petrochemicals & Industries, SRG Infotech, Nexus Software, Accurate Exports and Gufic Bio Sciences.

This move follows an order by the Gujarat High Court, Ahmedabad, on Friday putting a stay on the BSE’s decision to bring these 14 scrips under TTT segment. The petition was filed by Mr Dhaval Shah challenging the BSE’s decision to bring these scrips under the TTT segment.

While these scrips will be in the weekly settlement on the BSE, it is unclear whether the order of Gujarat High Court would also be enforced at the National Stock Exchange (NSE) as the petition was filed against BSE only.

These scrips would continue to be traded under the rolling settlement segment and the stay would be enforceable till the September 7, when the case is scheduled to be heard before the court.

Following huge volatility and excessive trading not commensurate with their floating stocks, Mukta Arts and Balaji Telefilms were shifted to TTT from August 20, and other stocks were shifted from July 23.

Under TTT, the market players do not have the facility of netting. It means that if an investor has sold 100 shares of Balaji Telefilms and bought 50 shares of the same company in the same settlement, then he has to deliver 100 shares and also make payment for the 50 shares bought by him.

Following the Ahmedabad High Court decision on Friday, Balaji Telefilms stock was frozen at the 8-per cent upper circuit at Rs 207.40 on the BSE. However, there was not much price movement in Mukta Arts counter as it closed marginally higher at Rs 83.50 from Thursday close of Rs 83.

However, as a matter of precaution, BSE has cautioned its members that it is moving to vacate this injection order at the earliest. In the circumstances, if the order is vacated, the exchange will revert these scrips to trade to trade segment.