sell jp associates around 146 target 135, 130
Mark Galasiewski, Editor, Asian-Pac Fin Forecast, Elliott Wave International, sees the rally on the
Sensex topping out this week. “At a minimum, we would be looking for a 38% retracement of that advance. At present, if we go a little higher, that should lead us back to the end of the previous fourth wave which is the April 22 low of approximately 10,700 on the
Sensex or 3,300 in the
Nifty.”
He feels markets won’t go back and retest its October 2008 lows.
pstl story
The Securities and Exchanges Board of India (Sebi) has blown the lid off a forgery masterminded by the promoter of Pyramid Saimira - Nirmal kotecha and the investigations have revealed a nexus between him, Rakesh Sharma, a PR agent representing Adfactors, journalist Rajesh Unnikrishanan and a few market operators.
Sebi has banned Nirmal Kotecha for masterminding the forgery of a Sebi letter. It has also barred another promoter PS Saminathan for spreading misleading information.
Also Read:
PS Saminathan victim of circumstances: Pyramid Saimira
Sebi bars Kotecha, associates from trading on stock mkts
Here is a verbatim transcript of Vivek Law’s comments on CNBC-TV18. Also watch the accompanying video.
A completely bizarre set of developments if one looks at this entire 50 plus page order. Back to December 21-22, there were two sets of stories that appeared in various newspapers that talked of a Sebi order to the promoters of Pyramid Saimira to make an open offer because they had violated certain takeover norms on creeping acquisition.
Background of the forgery
On December 22, which was a Monday, the market opened and the stock was up 10%. The share at that time was trading at roughly about Rs 70. The open offer was sought to have been directed by Sebi allegedly at Rs 250. So, quite clearly the stock shot up in the morning. By about 10:30 am, the Pyramid Saimira management said they had not received any such letter from Sebi. By the end of the day, the stock was down about Rs 10.
This is important because this is why this entire forged letter of Sebi activity was done. Let me break this up into two. First, why was this done and how did the forged letter activity happen. Why was it done seems pretty clear from the Sebi investigation. Nirmal Kotecha through his maternal uncle made a gain of Rs 20 lakh according to Sebi on just that one day. Nirmal Kotecha according to Sebi’s investigations was a buyer in the Pyramid Saimira stock for several months, and on December 22 he was the highest net seller. Sometimes the percentage went up to even as high as 40-50%, his percentage of the total net sales.
He transacted not just on his own name, he was transacting through several people. One of them was his maternal uncle and even just in that one period the gain itself was Rs 20 lakh. Quite clearly, according to Sebi, Nirmal Kotecha was building up his positions in this particular stock. This was really what it appears like a last ditch attempt to shoot the stock price up and get out of it.
People involved in the forgery
There were some other people he used as well. There are 230 entities who have been put out of the markets by Sebi for having been hand in glove through either banking or share transactions through Nirmal Kotecha.
There was another person called Amol Kokane. He is an engineering student who lives in Navi Mumbai. He was using the phone, which Kotecha claimed was his mobile number. This boy’s brother-in-law, who died in an accident in November last year was actually working for a broking outfit and he was really a front for Kotecha, as Sebi brings it out in its order. He was really the person who had given an absolute free-run to Kotecha to operate the demat accounts and the transactions were being done on the brother-in-law’s name. When the brother-in-law died it got transferred on to Amol Kokane’s name. His family income was Rs 1-5 lakh but his mobile phone bill per month was Rs 40,000. What has really happened therefore? There are heavy cash transactions by Kotecha, even as on the day when this whole forged letter was being drafted.
On next page: How did the forgery of the letter happen? How did the forgery of the letter happen?
What has really happened is that Kotecha, Rakesh Sharma – who used to work with a PR agency Ad Factors – and a journalist with the Economic Times Rajesh Unnikrishnan, according to Sebi really plotted sending this letter out to various media vehicles – newspapers, and to channels. Obviously this was not sent officially from the company or from the PR agency. It was sent by them using their old contacts. They even contacted former journalists who were based in Kolkata to send this out to other journalists out there whoever they knew. So, clearly the way it was being was not official. They sent it to people who they thought they knew and would manage to get the story in.
When a few journalists started calling up the Company Secretary of Pyramid Saimira to find out whether this letter was genuine at all or not they realised that the game might just go away. So, they planted a fake Company Secretary, a number of a person was given. He was impersonating as the Company Secretary and he kept claiming yes we have received such a letter. It was perfectly done. Unfortunately, when the news came out and when Sebi realised that this letter was forged it just went and did a complete audit of the bank statements. It was very audacious but I am very surprised that they thought they would get away with it. They haven’t.
We must add here that in these four months, Sebi has gone through bank transactions, it has actually gone back and monitored the location of these people from mobile towers information that they have got from mobile operators and it seems like an extremely thorough investigation that has been carried out in four months.
Why is PS Saminathan barred?
He has been held guilty of having been in fairly active transactional touch with Kotecha. He has been held guilty of actually facilitating Kotecha’s buying of the shares and subsequent selling of the shares. They are not involved, according to the Sebi order as far as the forgery side of this letter is concerned. But he is also accused of actually buying shares at Rs 45 per share when he was telling the media that my share is heavily undervalued and its fair value should actually be Rs 200. He is also accused of making wrong disclosures of his own shareholding and not complying with regulations which mandate disclosure of your shareholding.
Finally, there were certain book entry transactions with another broking firm in between, Kotecha as well as Saminathan, which was Keynote Capital. Sebi has found Keynote Capital was giving out research reports that were not really justifying the true value. Therefore it has barred Keynote Capital from issuing any further recommendations.
This is an interim order. Very importantly, this order has been sent to the RBI, it has been sent to the Financial Intelligence unit, it has been sent to the Income Tax Department because money laundering has been suspected. My sense is that there is a lot more that is going to unfold in this particular case in the coming days and weeks.
