Entities dumped GTB stock before moratorium

The lifting of a ban on 14 entities by a an order of Sebi Chairman G.N. Bajpai on June 12, 2004 has helped some of these entities exit from ...

The lifting of a ban on 14 entities by a an order of Sebi Chairman G.N. Bajpai on June 12, 2004 has helped some of these entities exit from 8212; or reduce their stake in 8212; the GTB stock just over a month before the bank was placed under moratorium. These entities were barred from trading in the GTB stock since December 2002.

Some of these 14 entities are parties involved in the Ketan Parekh scam. Both the Overseas Corporate Bodies OCBs 8212; European Investment Ltd and Far East Investment Corp Ltd 8212; were part of the tainted group in the Ketan Parekh scam of 2001.

Among the entities which entirely exited from GTB shares in the period June 12 to June 30, 2004 are Claridges Investments 038; Finance Pvt Ltd and Far East Investment Corp Ltd. Claridges Investments, which falls under the private corporate bodies category, sold 18.13 lakh shares or 1.49 pc of GTB8217;s equity, in a span of 19 days, since the ban was lifted.

The total PCB equity holding came down from 8.69 pc as on March 31, 2004 to 7.2 pc in June 2004.

Meanwhile, Far East Investment sold its entire stake since the Sebi ban was lifted, while European Investment Ltd trimmed its holding. The former sold 60 lakh shares or 4.94 pc of their holding in the 19 days it traded till June 30. The latter sold 2.60 lakh shares to trim its holding to 4 pc.

Meanwhile, the Investors8217; Grievances Forum in a letter to RBI brought to the notice the sharp fall in the holdings of FIIs from 16 pc in the beginning of June 2004 to almost 1 pc as on July 23, 2004.

The letter states that the Mauritius-based OCBs have offloaded about two crore shares between June 14, 2004 and July 23, 2004 and during the same period, the holding of retail investors went up from 40 pc to 55 pc.

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The letter adds that Sebi withdrew its ban on GTB shares sale held by the Ketan Parekh group as on June 13, 2004.