Mumbai, March 21: The Securities and Exchange Board of India (SEBI) has cracked down on multiple companies for misappropriation of funds raised through rights issues in the stock markets, after receiving complaints from whistleblowers.

SEBI is reported to have initiated investigations against these companies for the alleged illegal diversion of funds by promoters to their relatives or front companies for personal use rather than the declared purpose for which the money was raised.

The capital markets watchdog is currently looking into four or five such entities and has discerned a pattern in the misuse of such funds. The issue is, therefore, also being taken up on a broader level.

Most of the cases relate to small and dormant companies which float a rights issue, in which shares are offered to existing shareholders at a discount to raise funds for further investment to expand the business. However, these funds are then diverted for personal use such as buying property.

Unlike pump and dump cases, fund diversion from rights issues does not have an immediate impact on the stock market. Hence, such misuse of funds is more difficult to detect and whistleblower complaints are the main source of information in unearthing the cases.

In an interim order passed on December 5, 2024, SEBI observed that Mishtann Foods Ltd. misused proceeds from its rights issue, transferring funds to promoters and group entities instead of their stated purpose. The company withdrew an initial Rs 150 crore rights issue and later issued smaller rights issues under Rs 50 crore, seemingly to avoid SEBI scrutiny.

The markets regulator has barred the company from raising public funds and prohibited the promoters from trading or accessing the capital markets.

Mishtann Foods was also asked to return Rs 49.82 crore misappropriated from its rights issue and Rs 47.10 crore diverted through fictitious transactions. To improve governance, SEBI has mandated the formation of a new audit committee to ensure strict compliance with regulations.

Additionally, BSE has been directed not to approve any further rights issues by the company. These directives will remain in force until further orders.

In another order passed on December 11, 2024, SEBI released an order against Debock Industries Ltd. The company was found to have engaged in financial misconduct, including manipulating its financial statements, submitting false bank statements, and siphoning off rights issue proceeds.

The company allegedly used fictitious preferential issues to migrate to the Main Board of the stock exchange. As a result, SEBI imposed strict restrictions, preventing the accused from dealing in securities or accessing the capital markets.

New Delhi: Goldprices maintained a rising momentum for the third consecutive session to reach another all-time high of Rs 89,796 per 10 grams on Thursday, following a firm trend in global markets.

On the Multi Commodity Exchange (MCX), the precious metal contracts for April delivery hit a record high of Rs 89,796 per 10 grams in the morning trade.

Later, the yellow metal pared its gains and was trading Rs 268 or 0.3 per cent higher from the previous close at Rs 88,870 per 10 grams, with a business turnover of 13,084 lots.

Investors continued their safe-haven asset purchasing following the US Federal Reserve’s constant stance on the interest rate, according to analysts.

Globally, gold futures touched a lifetime high at USD 3,065.09 per ounce in New York.

“Gold rallies to another historic high in international markets after the US Federal Reserve held interest rates steady as anticipated, but signalled a possible reduction in borrowing costs by half a percentage point by the end of this year,” Rahul Kalantri, VP of Commodities at Mehta Equities Ltd, said. Both dollar index and bond yields maintained at low also boosted gold prices, he added.

Mumbai, March 20: Chief Minister Devendra Fadnavis on Thursday said that Microsoft and Gates Foundation will provide support to make Maharashtra a role model in the country in digital governance and right to service, especially when the government has started the use of artificial intelligence (AI).

Also, the Gates Foundation has shown its readiness to participate in the Lakhpati Didi initiative to fulfil the state government’s goal of making 25 lakh women entrepreneurs.

CM Fadnavis said this after meeting Microsoft co-founder, renowned entrepreneur and founder of the Gates Foundation Bill Gates.

The chief minister’s office in a release said that the duo also held a positive discussion on the use of artificial intelligence in health, agriculture and infrastructure.

CM Fadnavis said that as Maharashtra is going through a transformation phase, major projects are underway in infrastructure, agriculture, and health.

“Since there is a shortage of doctors in rural areas, the Gates Foundation should cooperate to provide quality health services and facilities. The Budget has also made provision for the use of AI in the health and agriculture sectors,” he added while giving the example of doubling the production of sugarcane in the Pune district using the technology.

CM Fadnavis told Bill Gates that the state government is trying to ensure that farmers have access to electricity during the day and for this, solar power is being used from 2022-23. From 30 per cent of electricity generation, now up to 52 per cent is being generated through solar, so farmers are getting electricity at a lower cost.

He also shared that there is a plan to make all the electricity feeders solar to provide them with electricity for 24 hours.

The Chief Minister also informed that an Innovation City is being set up in an area of 300 acres in Navi Mumbai.

Bill Gates assured to partner in technical assistance along with financial assistance for the Innovation City and other initiatives, according to the release.

Gates Foundation will provide technical and financial support to the state government to contain dengue in Gadchiroli district.

Bill Gates invited the chief minister to Seattle.