SEBI to pull up cos in Nissan Copper case

Market regulator the Securities and Exchange Board of India (SEBI) is said to be in final stages of issuing show cause notices to Venus Capital and couple of other domestic entities in the Nissan Copper case. It is believed that even the Economic Offences Wing (EOW) is playing an active role and is busy studying the investigation report prepared by SEBI.The case pertains to the stupendous rise in the share price of Nissan Copper, which was listed on the bourses on December 29, 2006. While the issue price was fixed at Rs 39, the first day saw the share price gaining a whopping 248% to touch an intra-day high of Rs 135.70 on the Bombay Stock Exchange (BSE). Further scrutiny made it clear that the rise was a result of a structured deal.Venus Capital and its two sub-accounts offloaded nine00000 shares and within seconds two brokerages — Deep Infrastructure and Park Light Securities — lapped up almost entire share. “It all happened in a matter of 18 seconds,” says a source, adding, “As a result of which there was no price fall. This cannot happen without prior planning.”Meanwhile, according to CBI sources, the EOW has already collected the investigation report prepared by SEBI and is busy analysing it. “The CBI works with SEBI in such matters as the former has greater powers in terms of issuing chargesheets. Since EOW has already started studying the investigation report, action can be expected soon,” said a source on condition of anonymity.Interestingly, there are two EOWs — the one operated by the Bombay Police and the other by CBI. The one under CBI looks into larger issues of money laundering and other related to fraudulent issues. Among the domestic entities, Vora group and Reniwal group are alleged to have played a key role in the price rigging.Incidentally, the Vora group is also one of the accused in the IPO demat scam. However, CBI did not file any chargesheet against Vora group in the demat scam as it believed that they were not among the frontline entities behind the scam.SEBI had come out with the ad interim order in the Nissan Copper case in January in which it asked the stock exchanges to withhold profits of many entities in a separate escrow account.The entities included Deep Infrastructure, Dhiren Vora, Sonali Vora, Park Light Securities, Rajeev Reniwal, Venus Capital Management, ITF Mauritius and VACUF, among others. Further, it also restrained Matrix Equitrade, RSS Investments, Park Light Securities, Religare Securities and H Nyalchand Financial Services from dealing directly or indirectly in the shares of Nissan Copper.SEBI, in its second order in the same case in October 2007, confirmed the ad interim order against three entities namely Mukesh Agarwal, Tanmay Agarwal and Sharvari M Agarwal.