JM Financial share price declined over 9% in early trade on Monday after the capital market regulator Securities and Exchange Board of India (Sebi) barred the company from acting as a lead manager for any new public issue of debt securities. JM Financial shares dropped as much as 9.82% to ₹79.30 apiece on the BSE.
JM Financial shares have fallen more than 17% in the past one week after sanctions from the Reserve Bank of India (RBI) on one of its group entities and now the latest Sebi order.
Sebi found some serious lapses while JM Financial acted as a lead manager for a particular public issue.
Read here: Sebi bars JM Financial from taking new mandates amid lapses in debt issue
However, concerning the existing mandates, Sebi's order on March 7 said that JM Financial can act as a lead manager for the public issue of debt securities for two months.
The regulator has given JM Financial the liberty to file its reply/ objections in the matter within 21 days.
However, JM Financial has said it would fully cooperate with the capital market regulator in its investigation into the public issue of debt securities.
In an exchange filing, JM Financial said, “The company shall fully cooperate with Sebi in this investigation."
Read here: JM Financial says will fully cooperate with SEBI in probe into public issue of debt securities
The regulator will undertake an investigation into these issues, to be completed within six months.
On March 5, the RBI barred one of its other group entities, JM Financial Products, from providing loans against shares and debentures, including sanction and disbursal of loans against initial public offering (IPO) of shares, with immediate effect.
The banking regulator’s action was on the back of certain serious deficiencies observed in the company’s loan process. RBI had also highlighted serious concerns about the governance issues in the financial services company, in addition to violating regulatory guidelines.
At 9:50 am, JM Financial Services shares were trading 7.65% lower at ₹81.21 apiece on the BSE.
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Published: 11 Mar 2024, 09:51 AM IST
