Shares of Omaxe fell 5 per cent on Friday following Sebi restrictions on the realty firm, its Chairman, MD, and three others from the securities market for two years for misrepresenting the company’s financials.
Extending its losses for the third consecutive session, Omaxe’s shares declined 5 per cent each of Rs 139.15 and 137.40 apiece -- its lower circuit limit -- on the NSE and BSE, respectively.
In the past three sessions, the company’s shares declined 15 per cent on both bourses.
In broader equity markets, 30-share benchmark BSE Sensex tumbled 700.52 points or 0.86 per cent to trade at 81,167.03 while NSE Nifty declined 239.75 points to 24,771.15.
Realty firm Omaxe said it will consider challenging market regulator Sebi’s order on Tuesday that barred the company, its Chairman Rohtas Goel, MD Mohit Goel, and three others from the securities market for two years for misrepresentation in the company’s financial statements.
“The company has not received any order from Sebi. Once received, the content will be verified and appropriate remedy available under the law, including the filing of appeal, will be contemplated,” Omaxe spokesperson said in a statement.
“As per news articles, it appears more in the nature of accounting interpretations, which were duly explained through documentation, market practice and case laws. Rest we will be filing our response to stock exchanges within the stipulated time frame, on receipt of order,” the spokesperson added.
In its 126-page final order, Sebi has also restrained three others -- Sudhangshu S Biswal, Arun Kumar Pandey, and Vimal Gupta -- from the securities markets.
The regulator has also levied a fine of Rs 47 lakh on 16 entities, including Omaxe, Rohtas Goel, Mohit Goel, and three others.
Sebi said these entities have “acted in concert in order to execute a fraudulent scheme that they tried to portray as normal transactions for the benefit of the company although it was experiencing loss, while also trying to portray these as merely lending activities, thereby trying to maintain the price of the scrip of Omaxe for a period of three years”.
The company misrepresented the financial statements during 2018-19, 2019-20 and 2020-21 through its various items -- revenue, debtors, advances, and expenses.
The order came after Sebi received a complaint against Omaxe alleging that the company conducted fraudulent transactions, diverted/siphoned funds, misrepresented the financial statements, and inflated turnover among others.
As these were serious allegations, the matter was taken up for further examination by Sebi, including a forensic audit into the affairs of Omaxe.
The investigation period in the matter was taken from April 1, 2018, to March 31, 2021, that includes 2018-19, 2019-20 and 2020-21.
