courtesy: moneycontrol
The BSE and NSE have suspended the trading in equity shares of Dewan Housing Finance Corporation Limited (DHFL).
June 14 onwards the ban will come into effect, both the stock exchanges noted in their respective circulars.
The BSE and NSE circulars also stated that DHFL had informed the exchanges on June 8 regarding the approval of the resolution plan by the National Company Law Tribunal (NCLT), Mumbai Bench which will provide for delisting of equity shares of the company.
NCLT had approved the resolution plan in the successful bid of Piramal Group for DHFL, envisaged zero value for the shares of DHFL. Although the stock was allowed to be traded.
On June 9 DHFL stated, which was added to to the circulars of the BSE and NSE, that “no value was attributable” to the equity shares as per the liquidation value of the company estimated by the registered valuers appointed under the Insolvency and Bankruptcy Board of India Regulations, 2016.
It was also said in the circulars that DHFL mentioned that the “written order of the NCLT approving the resolution plan is still awaited and all disclosures made will remain subject to such orders.”
The NSE stated that in pursuance of Regulation 3.1.2 of the NSE Trading Regulations P.A and for the reasons mentioned, it was hereby notified that the following security will be suspended from trading from June 14,2021.
The DHFL stock was allowed to be traded earlier this week. It was allowed to rise up to 10 per cent. And over 14 crore shares were traded on NSE alone. Investors took delivery of over 9 crore shares valued close to Rs 200 crore on June 8.
Around 5 million shares were traded on June 9.
The stocks had continued to be traded on both; NSE and BSE, despite the company informing the exchanges about their worth of equity shares being zero.
This drew criticism from market experts, who appealed to the exchange to stop trading the DHFL shares at the earliest, in order to protect the interests of the investors in the security market.
DHFL came under crisis in mid-2019, and went bankrupt.
The RBI in November 2019, referred DHFL for resolution under IBC.
DHFL was the third largest pure-play mortgage lender to be referred for insolvency under the Insolvency and Bankruptcy Code (IBC), and also the first finance company to be referred to NCLT by the central bank.