50 listed companies 'missing' after raising money
Published On: Friday, June 4, 2021 | By: Team KnowMyStock
Fifty listed companies are not to be found on their registered address and had been suspended for violations for more than six months. The stock exchange has also been unable to contact them through other means. The BSE had reached out to them with show-cause notices in December 2020.The latest notice dated May 26 gave the companies 15 days to respond. A number of companies raised money from investors in the 1990s and then were untraceable. These came to be known as ‘vanishing companies’. “We have given the notice to non-compliant companies seeking compliance. Where the company does not respond, further steps as mentioned above will be taken. Declaring a company as a ‘vanishing company’ is done by the Ministry of Corporate Affairs as per their criteria,” said an exchange official.
The 50 untraceable companies are from more than ten different states. They include Karnataka, Maharashtra, West Bengal, Uttar Pradesh, Tamil Nadu, Telangana, Andhra Pradesh, Gujarat, Madhya Pradesh, Haryana and Chhattisgarh.
The delisting move may be part of an effort to clean up the listed space by removing non-compliant companies.Compulsorily delisting such companies makes it difficult for existing investors to recover their money, according to Midas Touch Investors Association President Virendra Jain, who has earlier moved court over investor rights in non-compliant listed companies. Delisting makes it easier for promoters to get away without paying compensation, according to him.
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