In a rare confrontation on a regulatory requirement, realty giant DLF on Friday asked the two top stock exchanges BSE and NSE not to seek clarifications on each and every news item about the company.
Under the Sebi regulations, bourses are required to seek clarifications from the listed companies about news reports containing price-sensitive information about them if the same has not been first informed to the investors through the stock exchange platform. If the companies fail to provide a proper reply or justification, they are liable for further action.
DLF, as also a host of other listed companies, have regularly been asked to provide such clarifications whenever any news report surfaces with price-sensitive information.
on Thursday, BSE had sought clarification from DLF on reports that the company might sell 25-30% stake in its housing project in Delhi for Rs 800 crore to GIC.
Replying to the BSE notice in this regard, DLF on Friday said, ""We would like to humbly submit that seeking clarifications in each and every news item should be avoided by the exchange."
In its regulatory filing, addressed to both BSE and NSE, the country's largest realty firm said "the company during its normal course of business, keeps exploring various opportunities to enhance shareholders' value, which includes M&A, divestment of assets and fund raising opportunities.
"We would keep exchanges informed in case of any specific developments and the company shall continue to do so as part of its obligation under Clause 36 of Listing Agreement."
DLF, which has a land bank of about 300 million sq ft including nearly 50 million sq ft under construction, said it would keep the exchanges informed "in case of any specific developments and the company shall continue to do so as part of its obligation under the Clause 36 of Listing Agreement".
The Clause 36 of the Listing Agreement requires listed companies "to immediately inform the exchange of all the events which will have bearing on the performance/operations of the company as well as any price sensitive information".
Both the exchanges have provided a detailed indicative list of the material events on which listed entities are required to make disclosures to the exchanges, while "the listed entities may choose to disclose any other material event or any more information in the interest of investors."
The regulatory requirement has been put in place with an aim to ensure that the investors are first informed about any key development at the company.
There have been many instances in the past where the companies have been evasive in their reply to the exchange notices on news reports and have termed them as "speculative" and "premature", only to make formal announcements at a later date.
DLF has also been issued several such notices in the past, including one about a news report on May 20 about PVR being close to acquiring the company's DT Cinemas.
In its clarification on May 22, DLF had said, "We would like to clarify that we have not done any transaction with respect to DT Cinemas".
However, a few days later on June 9, DLF formally announced that its subsidiary DLF Utilities "has entered into definitive agreements to sell its cinema exhibition business operated under the brand name of DT Cinemas, to PVR Limited, on a slump sale basis for an aggregate consideration of Rs 500 crore".