5.7 lakh retail investors are stuck in Brightcom Group as NSE and BSE halt trading from June 14

In a major blow to nearly 5.7 lakh retail investors of Brightcom Group (BCG), a digital marketing solutions company, the National Stock Exchange (NSE) and the BSE have suspended trading in the company’s shares from June 14.

“The company has failed to comply with SEBI regulations for filing financial results for two consecutive quarters (September and December 2023 quarters). Therefore, trading in the securities of the company will be suspended with effect from June 14, 2024,” the NSE said in a circular on Wednesday.

“The suspension will continue until the company complies with SEBI’s master circular dated July 11, 2023. After 15 days of suspension, trading in the company’s securities would be allowed again on the first trading day of every week for six months,” it said.

According to BSE, the promoter’s entire shareholding in the non-compliant listed company and all other securities held in the demat account(s) of the promoter shall remain frozen during the period of suspension.

Vanguard holds shares

Currently, the promoters hold 18.38 percent shares in the company while the public holds 81.62 percent. In public, 5.7 lakh retail investors hold 37.89 per cent stake in the beleaguered company. Global index giant Vangurad also has a stake in the company through the Vanguard Total International Stock Index Fund (1.10 percent) and the Vanguard Emerging Markets Stock Index Fund (1.09 percent).

Among FPIs, LGOF Global Opportunities Fund held a stake of 2.48 percent at the end of December 2023. The others included top investors Shankar Sharma (1.14 percent stake) and Subrato Saha (2.02 percent).

The Hyderabad-based company was under the SEBI scanner for over two years for listing violations and concealing information, non-compliance and violating other norms.

The market regulator said the company understated expenses and overstated profits for five years from 2014 to 2015. The scale of the fraud was found to be large and the company attempted to conceal accounting entries worth ₹1,280 crore during the period.

The company’s shares touched the lower price of ₹12.27 on the Bombay Stock Exchange (BSE) on Wednesday. It touched an intraday low of ₹12.25 on the NSE.