SEBI imposes Rs.3.87 crores on 11 persons for manipulating Darshan Orna share price

SEBI imposes Rs.3.87 crores on 11 persons for manipulating Darshan Orna share price

The fines must be paid within 45 days

The Securities and Exchange Board of India (SEBI) has levied a penalty of Rs.3.87 crores on 11 individuals for manipulating the share price of Darshan Orna Limited through social media. The fine ranges from Rs.10 lakh to Rs.1.2 crore.

While a multi-layered manipulation scheme was orchestrated in the scrip of Darshan between September 2021 and June 2022, the messages on the social media platform Telegram created an artificial price increase, influencing investors to buy shares. Some of them profited over Rs 2.51 crores.

The entities involved were across three distinct operational tiers, whereby in tier 1, noticee 1 (Aakash Doshi) accumulated the company's shares through his own account and those of his father Dilip Doshi, while Kevin Kapadia traded in his wife, Kruti Kevin Kapadia’s account, and provided crucial funding support to participants.

The tier 2 funding infrastructure was bolstered by Satyen Dalal, who provided Rs.46 lakh in tranches to the Doshi family during the share accumulation phase. He received 90 percent of these funds during the selling phase, demonstrating the scheme's temporary nature.

In tier 3, Dhanpal Gandhi meticulously coordinated circulation of the message. A crucial link between the entities and the Telegram app, he worked in unison with Amesh Jaiswal and Jalaj Agarwal, who posted the recommendations online.

In its 81-page order, SEBI stated, "The trading activities in the scrip, coupled with messages on Telegram app, created an impression of increased price and volume in the market, which allegedly influenced the gullible investors to purchase Darshan’s shares. It was evident from the fact that the number of public shareholders witnessed a huge jump from 1,732 to 7,536 (an increase by 335 per cent) during the quarter of January-March 2022.”

As the share price escalated from Rs.77 to Rs.146.7, these individuals collectively profited Rs.2.51 crore while systematically exiting their positions. By indulging in the practice, they violated SEBI (Prohibition of Fraudulent and Unfair Trade Practices relating to Securities Market) Regulations, 2003.