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JPC draws list of 12 firms with proof of irregularity in share prices

Subhomoy Bhattacharjee

The joint parliamentary committee on stock scam has drawn a list of twelve companies whose share prices experienced unusual volatility and in respect of which there was evidence of manipulation or irregularity.

The list of twelve companies includes DSQ Software, Lupin Lab, Zee Telefilms, Global Telefilms, HFCL, Satyam Computers, GTB, Silverline Technologies, SSI Ltd, ICICI Bank, PSI Data Systems and Polaris Software and has been prepared on the basis of the special report of the Securities and Exchange Board of India.

Sebi had investigated the movement in scrips of 185 companies between the period October 1999 and March 2001. The report was discussed by the committee recently to decide on the extent to which the corporate sector should also be investigated in connection with the stock scam.

The report says that while Nirma and Wipro shares had also witnessed similar fluctuations there is no evidence regarding manipulation or irregularity in their scrips.

But for others it says: "These are scrips in respect of which manipulation or irregularities (have been) noticed." It has, however, not implicated the companies, except for Cyberspace Infosys, of any wrong doing. It says that the market regulator's probe "does not appear to have discussed whether the corporate bodies had any role in manipulation of prices of (their) scrips in stock markets".

Meanwhile, the committee members have aired their differences on whether the corporate houses should be called to depose before the committee.

The differences have held back the finalisation of the schedule of the committee. It has deiced to call only the brokers and the representatives of the Unit Trust of India for now, from January 3 to 14.

The report says these companies have also figured in the first report of Sebi along with Amara Raja Batteries, Ranbaxy Laboratories, Adani Exports, Pentamedia Graphics, Shonkh Technologies and Padmini Technologies.

But the JPC seems likely to let off the hook a large number of other companies that had been named by the market regulator in its report.

According to sources close to the committee, the decision is based on the realisation that it will be well nigh difficult to conduct such a mammoth inquiry especially as the evidence in many cases will need to be further strengthened by investigating agencies.

The report says that along with these cases, detailed investigations are still in progress for broking groups including Ajay Keyan, JM Morgan Stanley, and BLB Limited.

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