Mumbai, Aug. 11: Samir Arora’s quartet is under fire —shares that Alliance Capital’s former top gun fancied recoiled today under the scare of Sebi’s insider-trading indictment.
Digital Globalsoft, Mastek, Hinduja TMT and Balaji Telefilms wound up with sharp losses on bourses as an upshot of the market regulator’s ban on Arora from dealing in the capital markets for indulging in insider trading.
Digital Globalsoft, which finds a mention in the Sebi report that nailed the high-profile fund manager, finished 2.57 per cent lower at Rs 465.45 after opening at Rs 460 and dipping to an intra-day low of Rs 439.80. The report released over the weekend concluded that Arora sold his fund’s holding of 14.66 lakh shares of the company before the announcement of its swap ratio.
Balaji Telefilms lost 3.98 per cent at Rs 72.35, Mastek dipped 1.62 per cent at Rs 206.00 and Hinduja TMT fell 4 per cent at Rs 203.80. However, shares of United Phosphorus, also considered an Arora pick, finished higher at Rs 280.85 over its previous finish of Rs 275.35.
The regulator said in its order that Alliance Capital Mutual Fund, FIIs and sub-accounts of Alliance Capital managed by Arora failed to inform companies when their shareholding crossed the 5 per cent threshold.
An official reaction from Alliance Capital is expected on Tuesday, but two companies mentioned in the findings issued statements today reiterating they had followed highest standards of corporate governance.
Mastek said the senior management has no “legitimacy to run companies on behalf of shareholders if it is involved in practices like selectively sharing crucial unpublished price-sensitive information”.
“Mastek abides by highest standards of corporate governance. At no point of time, separate price-sensitive information is discussed or disclosed to any individual or group of investors or analysts,” the firm said.
On Sunday, Digital said it has implemented and adopted comprehensive policies, guidelines and processes aimed at stifling insider trading. These, it told exchanges, were in line with the regulations framed by Sebi, besides upholding the ideals of corporate governance. “Digital, therefore, does not believe that any irregular flow of information could have emanated from within the company in this regard.”