The Hindu Business Line : Brokers alarmed over shifting of stocks to T segment

STOCK brokers and investors have voiced concern over stock exchanges decision to shift stocks to Trade-to-Trade (T) segment and vice versa on a regular basis and said that the stock exchanges and SEBI should inform investors the reason for shifting or removing stocks to T segment.

This follows the various decisions by the stock exchanges in the last six months, where they have either shifted the stocks or removed them from the T segment.

The last change done by BSE was on March 9 in which 25 stocks were shifted to T segment and 172 removed from this segment.

The inclusion or deletion of stocks in T segment impacts their stock price. For instance, the inclusion of a stock in T group leads to fall in price and exclusion leads to rise in the stock price.

In T segment, an investor is not allowed the netting facility and this leads to possibility of low stock price manipulation.

Mr V.K. Sharma, Head of Research, Anagram Stock Broking said, "Regulators have the right to move swiftly in the case of emergencies, it would be in larger investors interest if the logic behind the action being taken is also informed."

Another broker, with large retail clients, said "such drastic measures (shifting to T group) were necessary when there was fear that rally in the small stocks could kill the broader market rally. There is no such fear now. In fact most of these stocks were out of the rally in November itself sensing that the rules are built against them".