Sebi restricts six from selling Dhenu Buildcon shares in manipulation probe

The Securities and Exchange Board of India (Sebi) has imposed restrictions on share sales by six entities connected to Dhenu Buildcon Limited, citing suspected market manipulation and unfair trade practices. The regulator's order comes after an investigation revealed an alleged pattern of artificial fund circulation designed to artificially boost the company's market value.

According to Sebi's findings, the individuals involved in the scheme allegedly rotated funds through various channels to create the appearance of legitimate business activity and higher company valuation. The manipulation allegedly enabled them to secure preference shares at favorable terms, providing undue benefits to select stakeholders while disadvantaging other investors.

The restrictions prohibit the six individuals from selling, transferring, or otherwise disposing of their shareholdings in Dhenu Buildcon until further notice. The regulator has also imposed additional corporate action restrictions on the company, limiting certain transactions that could be used to further manipulate its market position or financial standing.

Sebi's action underscores the regulator's ongoing focus on detecting and preventing schemes that distort fair market valuation through artificial trading activity. The case reflects mounting scrutiny of unlisted and emerging company share issuances, where information asymmetry and limited transparency can create conditions for manipulation.