Omaxe slide show continues; hit lower circuit for third day

Omaxe’s shares fell 5% on Friday after Sebi imposed restrictions on the realty firm, its Chairman, MD, and three others for two years due to misrepresenting the company’s financials. The shares declined 5% each to Rs 139.15 and 137.40 on the NSE and BSE, respectively, extending the losses over three consecutive sessions.

The broader equity market also saw a decline, with the BSE Sensex falling 700.52 points to 81,167.03 and the NSE Nifty dropping 239.75 points to 24,771.15. Omaxe stated that it will consider challenging Sebi’s order and will verify the content once the company receives it, taking appropriate legal action including filing an appeal.

The company believes that the issues were accounting interpretations and will respond to stock exchanges within the stipulated time frame.

Sebi’s 126-page final order also restrained three others from the securities markets and imposed a fine of Rs 47 lakh on 16 entities, including Omaxe, its Chairman, MD, and three others. Sebi found that these entities executed a fraudulent scheme to maintain the price of Omaxe’s stocks over three years by misrepresenting financial statements and conducting fraudulent transactions.

Sebi’s investigation period ranged from April 1, 2018, to March 31, 2021, including the financial years 2018-19, 2019-20, and 2020-21, following serious allegations against Omaxe. The matter was taken up for further examination, including a forensic audit into the company’s affairs.