Cipla movement under Sebi lens

the securities and exchange board of india has initiated a probe into the price movement of pharma major cipla prior to its inclusion in the bse sensex early this year. sebi is inquiring into the sharp upward movement in the stock witnessed prior to its inclusion in the sensex and has informed the jpc about the investigations. cipla replaced another pharma major, novartis in the sensex on january 8. however, the announcement of the change was made in september by bse. from then, the company's stock rose continuously from rs 650 to rs 1,106, a whopping rise of 70 per cent in 4 months. on january 8, when it moved to the sensex, the stock ended 2.8 per cent higher at rs 1,106 when most other stocks were down. cipla had been moved to the sensex as novartis market cap had declined and liquidity had dried up, both of which were found in cipla. cipla is also present in s&p nifty index. cipla is now the fifth pharma scrip being probed by the sebi in its current investigations apart from ranbaxy, american remedies, jagsonpal pharma and lupin labs. sebi investigation found that the promoters group of lupin laboratories ltd sold a large quantity of shares of lupin laboratories to the investment companies associated with ketan parekh viz, classic credit ltd and panther fincap and management services ltd. it was further seen that, the promoters sold a large number of shares to a group of fiis. investment companies associated with ketan parekh transacted in the scrip in large quantities. from the analysis of order log and trade log it appeared that, entities associated with ketan parekh entered orders in the scrip of lupin laboratories ltd. on bse and nse in order to create a higher price for the scrip. in its probe in ranbaxy, it found that ranbaxy group companies sold about 30 lakh shares with entities associated with ketan parekh during the period under probe, in what sebi says looks like synchronised deals. it has noted that in the same period, kp associates too had dealt in a big way in ranbaxy scrips. the sebi lens is also focusing on a number of allied developments involving ranbaxy. this include a loan that the promoters of ranbaxy took from ge capital services for buying shares of ranbaxy during march 1999. ranbaxy's proposed deal with bayer ag for licensing of drugs was also being analysed by sebi. jagsonpal pharmaceuticals ltd is facing investigations by sebi due to irregular activity on account of trading. sebi noticed cross deals and structured deals between some trading members. sebi investigations into american remedies scrip just before the acquisition by drl showed that shares purchased by two investment companies prior to public announcement have been tendered in the open offer at a profit. also, its been investigated if the purchases by the two companies were on the basis of informed buying. sebi's investigations have found that american remedies ltd's scrip was in limelight since may 1999 following disposal of its bulk drug unit and there was an increase in volume and movement in price from rs 60 in september 1999 to rs 180 in november 1999 due to a combination of buying and selling interest ahead of a possible takeover. according to sebi, the matter was under investigation as the major activity in the scrip was concentrated during the period prior to the takeover. analysis of broker details indicated that the major sellers were banks and its subsidiaries and an individual who was one of the original allotees during the public issue of american remedies.

Cipla movement under Sebi lens

THE SECURITIES and Exchange Board of India has initiated a probe into the price movement of pharma major Cipla prior to its inclusion in the BSE Sensex early this year.

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