I was and I am not tracking the company. However chatgpt says - Manipulation Case Not Yet Fully Resolved and there is no public udpates. Most of so called marque individual investor in India has some form of advantage which we, retail investor, won’t able to understand - this is as per I heard in conversations. Promoter stake is going down and public is going up - is like red flag for small companies - as per me. Said so as am not tracking hence don’t have any opinion.
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SEBI final order IN THE MATTER OF SEACOAST SHIPPING SERVICES LIMITED
This is my moment of “maine bola tha” regarding seacoast shipping. I warn VP friends on my first post of Dec 2023 and subsequent later.
Sebi came with the final order but before that Manish Shah accepted diverting money and bizarre reason…
Money raised through the Rights Issue was diverted because at that time Manish Shah’s son was kidnapped. 
Wrongdoing:
Over 85% of sales and 98% of assets were found to be fictitious (not real).
Promoters issued new shares, sold them to investors, and then sold off their own stake, reducing their holding from 74% to almost zero.
Money raised through rights issues was allegedly diverted (not used for business, but for personal purposes).
Said so, it was easy to find fraud in this company. For retail investors, the lesson is simple: there is no free lunch.
final_order_sssl.pdf (2.5 MB)
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SEBI order against Man Industries (India) Ltd. MIIL
1759153803084_1.pdf (1.2 MB)
SEBI found that Man Industries (India) Ltd. and its directors misrepresented financial statements (non-consolidation of subsidiary accounts, undisclosed related-party transactions, and fund rotation) between FY2015–16 and FY2020–21
As a result, the company and three executives have been barred from the securities market for 2 years and fined a total of ₹25 lakh each.
Example - level of innovative fraud: The allegation is that MIIL had recorded a cheque on hand as on 31st March 2020 against interest receivable of ₹1,150.49 lakhs, based on cheque no. 387925 issued by MSPL and bank overdraft in the books of MSPL. However, the cheque was never realized and was subsequently reversed in the books on 30th June 2020. Thereafter, fresh payments were made by MSPL only between 20th June 2020 and 24th July 2020.
Non-consolidation of subsidiary accounts – MIIL failed to consolidate the financials of its 100% subsidiary - Merino Shelters Pvt. Ltd. (MSPL) from FY2015–16 to FY2020–21, thereby misrepresenting its financial results.
Diversion and rotation of funds – Loans advanced by MIIL to MSPL were routed further to other group companies
Loans of ₹5,641 lakh to MSPL were converted into “capital advance” without audit committee approval.
Loans were extended to related entities like LCPL without proper approvals.
MIIL did not record interest on loans given to MSPL, contravening accounting standards and Companies Act norms.
Writing off inter-corporate deposits (~₹40 crore) without proper compliance.
Many more…
My idea is to list all fraudulent companies in this thread to create awareness to self and for vp friend.
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Dronacharya - bookmarking in this thread for easy tracking and learning.
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Chemkart is a recent IPO nano-cap company. Chemkart MD was recently arrested by DRI, later released on bail. The stock price, already at low valuations, has further corrected nearly 40% in the last two days.
Although I have no holding in this stock, I was considering it as a prospective investment opportunity. I’d like to believe to be able to detect fraudulent practices by looking at the numbers, etc., but in this case I have been caught totally out of the blue.
The company is into chemicals trading business with no manufacturing facility (setting up such facility is the next thing they were planning to do). But so are many other companies too. As of now my solace is “a brilliant promoter with bad intentions can screw an investor really bad”, which is not really much useful.
If anyone is aware of or can find any prior red flags about this company, I’d love to be educated about what I missed.
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A few basic rules you violated:
- Don’t invest in SME stocks (very difficult to track)
- Don’t invest in newly listed companies (you never know what awaits you, like it happened here)
- Don’t invest in trading companies (very easy to fudge numbers)
A few years back I wrote a list, refer to this:
https://forum.valuepickr.com/t/what-should-a-first-time-investor-do-where-to-start/13629/29
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Well I’m not a beginner, so I am allowed to violate at least some of the rules ;-). I invest primarily in SME stocks and also in recent IPOs. I’ve been doing this for a long time and occasionally lost money also, compensated by gains from other stocks.
Lesson for me is that violating too many rules is likely to backfire. Understanding the business at the fine-grained level becomes paramount for small companies—“trading” is easy to fudge numbers as you described. [Not entirely sure if the company is at fault, but an investor would better keep away before clarity emerges.]
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I think in due course of time, there is a good chance that this one will qualify in this bucket. But let’s track it from here on.