The Securities and Exchange Board of India (Sebi) on Saturday told investors in the optionally fully convertible debentures (OFCDs) of Sahara Group not to yield to pressure by company agents and shift investments to the Sahara Q-shop.
Sahara Q-shop is an investment scheme from the Sahara India Parivar being marketed as a retail venture. Star cricketers, including Mahendra Singh Dhoni and Sachin Tendulkar, have been part of a high-profile campaign to promote Q-shop as a fight against adulteration (milawat se jung) in food and other consumer products.
“Don’t be forced, don’t be misguided,” the Sebi said in newspaper advertisements advising bondholders of Sahara India Real Estate Corporation (SIRECL) and Sahara Housing Invest Corporation (SHICL) “to hold on to the original documents relating to their investments in bonds and to produce the same to Sebi when called for”. An email seeking comments sent to a Sahara Group spokesperson did not elicit any response. Some experts are sceptical about the move, as advertisements in English newspapers may not reach the real target audience. Citing media reports on how 90 per cent of Sahara investors were unbanked, economist Ajit Ranade tweeted, “90% of Sahara depositors don't even have bank a/c. what's point of these English newspaper ads?”
| LEGAL TROUBLE |
| November 24, 2010: Sebi bans raising money by Sahara entities |
| May 12, 2011: Supreme Court directs Sebi to pass final order |
| June 23, 2011: Sebi passes final order asking Sahara firms to repay investors |
| October 18, 2011: SAT upholds Sebi order, gives six weeks’ time |
| August 31, 2012: Supreme Court upholds SAT and Sebi orders, gives three months to repay all investors |
| November 30, 2012: Deadline ends |
| SAT: Securities Appellate Tribunal |
These advertisements issued in the public interest are likely to be repeated in regional newspapers, too, according to people in the know. The regulator has asked investors “not to yield to any pressure from any person, including Sahara or its agents, for converting or switching their existing investments in the bonds to any of the other schemes like Q-shop, etc.”
It added, “Please bring the details of any such instances to the notice of Sebi.” The Supreme Court on August 31 had directed the above Sahara firms to furnish details of 30 million investors who bought OFCDs worth Rs 24,029 crore. It had asked the Sebi to arrange a refund for all the investors, with 15 per cent interest.
Some investors complained the switch had already been done without their consent, the Sebi said. Earlier this week, a Sahara spokesperson had put the blame on some agents who were switching schemes to earn commissions. The agents had been asked to stop that, the spokesperson said.