Sebi puts Larsen & Toubro scrip under microscope
Mumbai: In view of the contradictory announcements regarding the demerger of its cement business, the Securities and Exchange Board of India (Sebi) is examining the possibility of manipulation in the Larsen & Toubro scrip during the past few days.

The regulator is also looking into the issue of whether L&T fully complied with the disclosure norms under the listing agreement with stock exchanges. The controversy has arisen on account of the fact that prior to the board meeting the company had issued a denial to the press reports that the board meeting was to consider the issue of demerger. However, when the board meeting did take place, one of the items discussed and cleared at the meeting was the demerger of the cement business.

This action of the company led to a volatile jump in the share prices.

Analysts said that L&T had clearly misled investors when it issued a denial to the press report. The common view is that, demerger is a price sensitive information and the company should have informed stock exchanges well ahead of the board meeting.

Sebi guidelines specify that companies are to inform the stock exchanges of their decision to convene a board meeting at least a week before the date of the meeting.

They are also expected to indicate any price sensitive issue that might be considered by the board. Further, stock exchanges are required to check from companies the veracity of reports published about them with regard to price sensitive information and companies are to get back to the exchanges.
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