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Companies trying to manipulate market, says SEBI chief

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By NewsGram Staff Writer

A watch is being kept on listed companies to see if they are complying with capital market regulator Securities and Exchange Board of India (SEBI) rules or trying to manipulate the market to serve vested interests, its chief said on Friday.

“Some companies are trying to manipulate the market by avoiding paying long-term taxes,” SEBI chairman Upendra Kumar Sinha told news channel CNN-IBN on Friday, adding the watchdog did not hesitate to act against some of the largest corporates found violating rules.

“We notice even a slightest attempt to manipulate (the market). As we caught (some companies) in wrong-doings in their IPOs (initial public offerings), no manipulation is possible henceforth.”

To prevent manipulation from the beginning, SEBI introduced call option to buy shares at an agreed price on the opening day of any company’s IPO.

“As a pro-active and sensitive regulator, we act against any company if we anticipate something going wrong (with it) even before action is sought,” Sinha said.

For instance, SEBI allowed some start-ups to list their shares on the exchange for trading even before there was demand for their shares, he said.

Claiming that there was no political pressure on the regulator, the former IAS officer said the it had worked with many governments earlier and maintained its stand.

“Even the Supreme Court (on July 6) upheld our order to regulate GDR (global depository receipts) that are raised by Indian companies and listed on overseas exchanges like Germany.

Noting that it was unfair to assume its crackdown on capital markets had impacted filing of red prospectus for IPOs, Sinha said on the contrary, filing for IPOs had gone up during the last two years.

“As market watchdog, we facilitated IPOs, fund-raising, electronic filing by them,” he said.

Observing that corporates would invest when the macro-economic climate was good, Sinha said traditional way of raising money to manipulate (stock) markets had gone away.

Denying that he was unfair to Indian conglomerate Sahara in dealing with its violation of rules, he clarified that even the Supreme Court had upheld his actions against the company for defaulting on paying back its investors.

“As a regulator, we deal with matters in a very dispassionate way. It is mischievous allegation that I had acted against Sahara in a partisan way,” Sinha added.

(With inputs from IANS)

Next Story

Ride-hailing Giant Uber Files for IPO, Says ‘May Never Make Profits’

According to market sources, the company may provide a price range for its shares later this month and would go public in May

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Photo shows an exterior view of the headquarters of Uber in San Francisco. (VOA)

Global ride-sharing major Uber has warned in its IPO filing that the company may never make profits as its operating expenses are likely to increase “significantly in the foreseeable future”.

The company filed for its Initial Public Offering (IPO) on Thursday and would be listed on the New York Stock Exchange (NYSE) under the symbol “UBER”.

“We have incurred significant losses since inception, including in the United States and other major markets. We expect our operating expenses to increase significantly in the foreseeable future, and we may not achieve profitability,” the company said in the “S-1” form or the IPO Prospectus submitted to the Securities and Exchanges Commission.

It further said that to remain competitive in certain markets, it has lowered the fares in the past and may continue to offer “significant driver incentives and consumer discounts and promotions”.

Uber app.

The decade-old company also warned that it may fail to develop and successfully commercialise autonomous vehicle technologies and expected that its competitors would develop such technologies before it.

“Such technologies may fail to perform as expected, or may be inferior to those developed by our competitors,” said the company in the IPO Prospectus.

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The company noted that as of December 31, 2018, it had 91 million or 9.1 crore monthly active platform users. There were 3.9 million or 39 lakh drivers on the platform by the end of 2018.

According to market sources, the company may provide a price range for its shares later this month and would go public in May. (IANS)