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Sebi puts K-10 stocks under watch

BS Markets Bureau

The Securities and Exchange Board of India has taken note of reports that broker Ketan Parekh is active again in the stock markets and has asked the stock exchanges to keep a close watch on stocks known to be his favourites and whose prices have shown considerable volatility in recent weeks.

Sebi chairman D R Mehta, however, refused to comment on the issue. He said: “We do not go by any individuals or companies—if there is any unusual movement in scrip prices, we ask the stock exchanges for details and to keep a watch on such scrips.” Sebi officials, however, said they could not ignore market information and were acting upon it.

Incidentally, market reports also suggest that a prominent fund manager of a leading private sector mutual fund is again back in action along with his former associates. He was one of Parekh’s close allies during the broker’s more active days.

According to market statistics, stocks formerly favoured by the broker have gone up by 350 per cent in terms of prices and 40 per cent in volume terms in the last three months.

While the stock exchanges are closely monitoring the situation, the idea is gaining ground that some of the more volatile stocks may be put on the trade-to-trade segment. No actual decision has been taken so far, but indications are that the exchanges may soon take some action, at least for a short period till the volatility ends.

An analysis of the trading pattern of some of the scrips such as Himachal Futuristic, SSI and Pentamedia Graphics shows that the volume of trading is far in excess of the actual outstanding equity shares of the companies in the market.

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