Shell shock: No sales, years of losses, yet retail investors held up to 95% stake
Amit MudgillETMarkets.com NEW DELHI: Were they out of their minds when they picked those stocks?
The Sebi crackdown on suspected shell companies and fact checking thereafter reveal interesting details: almost half of these companies had nil sales and reported losses year after year, yet retail investors held up to 95 per cent stake in them!
As many as 36 lakh investors have got trapped in the stocks of the 331 suspected shell companies after a surprise Sebi crackdown led to a trading halt on these counters.
Out of these 331, 167 are listed on BSE. Data available for 154 of these firms show one-third of them, or 50 to be precise, have been reporting losses for four consecutive years now. Over two dozens of them reported zero sales for last financial year. Yet, retail and high net worth individuals hold up to 95 per cent stake in these companies.
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