Shares of this small-cap company hit the 5 percent lower circuit post an interim order from the Securities and Exchange Board of India (SEBI).
With a market capitalization of Rs 4,637.18 crores, the stocks of Brightcom Group Limited opened their trading hour on Wednesday at Rs 22.98 and currently are locked in the 5 percent lower circuit recorded at the same price.
Such bearish moves today were witnessed after SEBI, under the SEBI Act, 1992, gave an interim order to the company pointing out some lapses in the preferential issue of shares made by the company.
It is alleged that the money raised through the issue was provided as loans and advances to its subsidiaries. In addition, proper disclosures were not made in the annual reports concerning this utilisation of the proceeds of the preferential issue.
SEBI has also barred the company’s top executives such as Mr. Suresh Kumar Reddy, Chairman and Managing Director (CMD), and Mr. Narayan Raju, Chief Financial Officer (CFO), and restrained them to hold any Directorial position until further notice. The market regulator also restrained Ace Investor Mr. Shankar Sharma from selling the company’s shares.
During the recent quarter period, the company has been able to successfully improve its prime business indicators such as operating revenues and after-tax profits.
The operating revenues rose from Rs 1,367.92 crores during Q4FY22-23 to Rs 1,690.32 crores during Q1FY23-24, and, the after-tax profits, during the same time horizon, took a shift up from Rs 229.15 crores to Rs 321.48 crores.
As per the shareholding data available for the June 2023 quarter, the company’s Promoters hold a 18.44 percent stake, and the Foreign Institutional Investors (FIIs) hold a 8.87 percent stake in the company.
Brightcom Group Limited is a company based in India that is involved in the business of providing digital marketing services and software development for computers locally and outside the country. The company serves various agencies and online publishers with a majority of its revenues being generated from the export of software solutions.
Written by Amit Madnani
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