India’s securities regulator is pursuing delistings of firms with no economic activity, Chairman Tuhin Kanta Pandey said in remarks reported by PTI, citing potential investor risks tied to some shares.
Pandey made the remarks in Kolkata on Oct. 31; the Securities and Exchange Board of India (SEBI) did not include the delisting proposal in its published address from that day. He said manipulators use shares of some inactive firms in pump-and-dump operations. Social media groups could widen the circle of investors facing potential risks, PTI reported.
Neither outlet named companies under consideration or explained how SEBI would identify them. The reports gave no company count, selection criteria, price threshold or timetable. They also did not explain how shareholders would be treated or whether an exit option would be offered. The reports do not describe a policy covering all low-priced shares.
In its Oct. 31 address, SEBI said the number of distinct people investing in India’s securities market had reached more than 150 million, four times the fiscal 2019 level. Pandey also warned about unrealistic return claims, misleading online advice and increasingly sophisticated digital fraud.
The reports also offered different descriptions of SEBI’s use of artificial intelligence (AI). PTI reported that the regulator was using AI to examine accounts but did not detail the system’s scope. The Economic Times separately reported a plan for AI screening of firms with little economic activity to speed up alerts. SEBI’s published address did not describe either use, and the reports did not clarify whether they concern one system.
Separately, Pandey told PTI that SEBI expected to issue a consultation paper on foreign portfolio investor rules in the coming weeks. He said the proposals would ease some disclosure and concentration-limit requirements. The reports gave no date for action on inactive listings.
