SEBI banned a company that has been listed for barely a year and its directors
SEBI has banned Kalahridhaan Trendz Ltd (KTL), which has been listed for less than a year on NSE SME platform, and its directors from accessing the securities market until futher orders. KTL has been listed on the platform only since February 23, 2024. The small and medium enterprise (SME) and its directors have been charged with making questionable disclosures to mislead investors. As per the order, the resignation of the company secretary, followed by two independent directors and the CFO, puts the affairs of the company under a cloud of suspicion.
According to an interim order-cum-show-cause notice, the SEBI’s examination of the company, held between February 23 and December 15 of 2024, started after HDFC Bank filed certain complaints regarding default in credit card dues. The lender’s complaint alleged that Niranjan Agarwal, managing director, also holds directorship in Katex Exim, of which the directors were clearing the dues to ensure no impediments in its IPO process while ignoring obligations of KTL.
SEBI also found out that its May 2 disclosure of it capacity expansion plan leading to a 25% increase in profit margin and a significant rise in revenue was not in line with guiding principles. After the disclosure, the volume of trade had risen by 300%. Not just this, the August 12 disclosure about an order win of Rs. 115.5 crore from Beximcorp is also in question as there is no such company in existence. The disclosure had led to an increase in price and volumes traded in the stock.
