At a time the Securities and Exchanging Board of India (Sebi) board members are also waffling over the issue of introducing mandatory IPO grading, Orbit Corporation was bold enough to opt for it. Contrary to the confidence that this move suggests, the issue got the lowest possible grade — 1 out of 5. Sebi had assigned the grading exercise to Care. Sebi rules mandate that if a company opts for voluntary IPO grading, it has to disclose it in its prospectus and advertisements, but Orbit failed to do either. Sebi has now asked the lead manager, Edelweiss, to correct the omission.

The Rs 106 issue to fund realty projects opens on March 20. Interestingly, this is not the first time that Sebi has had to make Orbit disclose all the relevant facts. Earlier, following omissions in its red herring prospectus, the regulator asked the company to “include full details of the raid/ search and seizure, including details of seizures, voluntary disclosures made, if any, during the raid and also to include a suitable risk factor effect in the document”. Incidentally, on a day when the market crashed over 453 points, only a few Indian realty stocks had magically bucked the trend, although the realty bubble has begun to unravel globally.

SHCIL’s proliferations

The Bombay Stock Exchange website lists SHCIL Services, a brokerage firm, as promoted by the Stock Holding Corporation of India (SHCIL). However, the parent informs us that SHCIL Services is not a subsidiary. True. It is not any more. Sources in investigation agencies reveal that 76 per cent of the equity has passed into private hands but there is no public disclosure of shareholding by this large public entity. In fact, a search of the Ministry of Company Affairs (MCA) website reveals that SHCIL has quietly spawned five new entities.

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