The Hindu Business Line : Petition moved against Orbit Corp listing

Mumbai April 10 The Indian Investor Protection Forum has filed a writ petition in the Bombay High Court seeking a stay on the listing of shares of Orbit Corporation Ltd, which had recently made an IPO.

The petition also seeks not to permit the operation of the escrow account in which institutions have placed their subscriptions. The petitioner claims that the company, engaged in real estate construction, had not made adequate disclosures on their land development activities in their Red Herring Prospectus filed with the Securities and Exchange Board of India and thereby failed to follow the guidelines.

The IPO of Orbit Corporation was oversubscribed 3.85 times. The company had planned to get listed on the exchanges on April 12.

Mr Satyendra Ramgopal Sharma, Promoter of Indian Investor Protection Forum, who filed the petition, told Business Line, "The company is currently working on 16 sites, of which details of only 12 sites have been mentioned in the red herring prospectus. Besides, the due diligence certificate of the co-book running lead manager, Enam Securities, who withdrew from the issue, was not provided. Also, the money from the promoter's contribution is only a book entry."

Orbit Corporation claims all the disclosures in the red herring prospectus were as per the Disclosure and Investor Protection guidelines of SEBI. "The prospectus was submitted to SEBI on August 16, 2006 and was available for public scrutiny," said Mr Ramashrya Yadav, Head-Finance and Strategies, Orbit Corporation Ltd.

`SEBI silent'

Mr Yadav also said Enam Securities was appointed only for marketing of the IPO to domestic and HNI retail clients and not as the co-book running lead manager and, therefore, they were not required to provide the due diligence.

The SEBI has been silent on the issue, said Mr Sharma. The case will be heard on April 11.

More Stories on : Shareholder Activism | IPOs | Real Estate & Construction

Article E-Mail :: Comment :: Syndication :: Printer Friendly Page

Stories in this Section
StanChart Bank firm on entering securities broking

NSDL to keep records for new pension scheme

Insurers, MFs drive up coupon on bank bonds

Mid-cap stocks catch market attention

Volatile movement

SEBI signs MoU with Thailand, Nigeria market regulators

Markets end flat on cautious day

Hilton Metal plans public issue to raise Rs 38 cr

Bhagwati Banquets plans Rs 92-cr public issue

Fortis Healthcare issue opens on April 16

Petition moved against Orbit Corp listing