Advertisement

HindustanTimes Thu,27 Nov 2014

Earnings dilution: Sebi fines Reliance Rs. 13 crore

letters@hindustantimes.com, PTI  Mumbai, August 09, 2014
First Published: 01:34 IST(9/8/2014) | Last Updated: 01:47 IST(9/8/2014)

The Securities and Exchange Board of India (Sebi) on Friday slapped a penalty of Rs. 13 crore on Mukesh Ambani-led Reliance Industries Ltd (RIL) for repeated non-disclosure of a key earnings ratio for six quarters. The regulator has said that the information would have had a significant impact on investors’ decision to buy or sell shares.

Advertisement

The penalty includes a Rs. 1-crore fine for violation of listing agreement and another Rs. 12 crore for violation of the Securities Contracts (Regulation) Act in relation to non-disclosure of the diluted earnings per share in the quarterly and annual disclosures.

“We are now studying the order as to the interpretation Sebi has taken and would take appropriate action based on legal advice,” an RIL spokesperson said in a statement. “The issue relates to the method of calculation of diluted EPS under the accounting standards. The issue is not of non-disclosure.”

The order follows a probe by Sebi in an over seven-year old case involving alleged irregularities in issuance of 12 crore warrants by RIL to its promoters, entitling its holders to subscribe to equivalent number of RIL shares.

It was alleged that this issuance in April 2007 had resulted in diluting the pre-issue paid-up equity share capital of RIL, but the company repeatedly failed to disclose such dilution in earnings for as many as six quarters.

In the current case, a show-cause notice was served on RIL in February 2013, listing out allegations levelled against the company.


Advertisement
more from Business

Nippon to up Reliance MF stake to 49%; Rs 657 cr for first 9%

Japanese financial services giant Nippon will hike its stake in India's top fund house Reliance Mutual Fund from 26% to 49%, while investing Rs 657 crore for the first tranche of 9%.

markets
Advertisement
Most Popular
Advertisement
Advertisement
Copyright © 2014 HT Media Limited. All Rights Reserved