Case Study of Sebi Sample Essay

Market regulator Sebi has given its go-ahead to the non-banking finance company Bajaj Finance’s proposed rights issue to raise up to Rs 750 crore.

In rights issue. portions are issued to bing investors as per their retention at pre-determined monetary value and ratio.

Bajaj Finance had filed bill of exchange paperss with Sebi in November to raise up to Rs 750 crore through a rights issue.

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Sebi issued its concluding observations on the bill of exchange offer paperss on January 8 as per the latest update by the market regulator. Sebi’s observations are necessary for the companies to establish rights issues.

Bajaj Finance. a subordinate of Bajaj Finserv. is engaged in the concern of consumer finance. SME finance and commercial loaning.

The company plans to utilize the returns of the issue for beef uping its capital base.

JM Financial Institutional Securities is moving as lead director to the issue. while Karvy Computershare is the registrar.

Earlier in August. Sebi had given its blessing to Bajaj Finserv to raise up to Rs 1. 000 crore through rights issue.

Sahara instance
The Lucknow bench of the Allahabad high tribunal will hear the Sahara Group versus Securities and Exchange Board of India ( SEBI ) instance merely after the capital markets regulator completes its investigation into the nature of the fiscal instruments used by the two Sahara Group companies to raise money from the populace. Sahara India Real Estate Corp. Ltd and Sahara Housing Investment Corp. Ltd are contending the regulator on the issue optionally to the full exchangeable unsecured bonds ( OFCDs ) being used to roll up financess from investors. The Supreme Court on 12 May had asked SEBI to find the nature of OFCDs and whether Sahara was utilizing them in a legitimate mode to raise money. SEBI is likely to subject its study on OFCDs issued by Sahara in the first hebdomad of July. “The apex tribunal in its 12 May order had said that the high tribunal can take to continue or non continue with the instance hearing boulder clay SEBI passes an order finding the nature of OFCDs issued by Sahara Group. ” said a attorney for SEBI. “Therefore. the high tribunal adjourned the hearing in the instance till 20 July. ” The Supreme Court had earlier dismissed Sahara’s claims. stating that the cardinal prevarications in the definition of OFCDs used by Sahara to roll up public money.

“Why are you afraid? Let SEBI give its opinion. It is an adept organic structure. We want to cognize what are OFCDs. ” said a bench led by Supreme Court Chief Justice S. H. Kapadia. authorising the regulator to continue with its investigation. Sahara India Real Estate and Sahara Housing Investment had raised Rs. 4. 843 crore by publishing OFCDs to investors under three schemes—Abode Bonds ( Rs. 1. 385 crore ) . Nirman Bonds ( Rs. 1. 980 crore ) and Real Estate Bonds ( Rs. 936 crore ) . harmonizing to a June 2009 filing. SEBI said the fund-raising was a misdemeanor of public issue norms laid down under the Companies Act and the SEBI Act. On 24 November 2010. SEBI banned several Sahara group entities including head Subrata Roy from raising money from the populace for allegedly go againsting public issue norms. Subsequently. on 13 December. the Lucknow bench of the Allahabad high tribunal stayed the SEBI order pending probe.

On 4 January. the Supreme Court granted SEBI permission to seek and acquire inside informations of names. references of investors and the sum invested in these strategies. SEBI’s November prohibition on Sahara Group companies raising financess came into force on 7 April after the Allahabad high tribunal vacated a stay on the order. Sahara is non allowed to raise money from the populace. Sahara had ab initio said the money it was raising was done private arrangements. But harmonizing to the jurisprudence. if the figure of investors exceeds 49. it will come under SEBI’s legal power. said the regulator’s advocate after the hearing. Sahara admits to holding approximately 6. 6 million investors. The signifiers used by the lodging houses claim investors can anticipate returns in a scope of 123-253 % . depending on the type of bond. Investors can besides exert the option of change overing their bonds to equity portions upon maturating. the bond sale paperss said.


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