Bharat Global Developers shares crashed to its lower circuit of five percent in the early session on December 23, after market regulator Securities & Exchange Board of India suspended trading in the stock until further orders. The regulator has also barred the company’s promoters from accessing capital markets indefinitely.
This comes after a complaint dated December 16, 2024 and social media posts highlighting suspicious financials and disclosures by the company.
The complaint noted a dramatic rise in Bharat Global Developers’ share price, which jumped 105 times between November 2023 and November 2024. From Rs 51.43 per share on December 26, 2023, shares surged a whopping 2,304 percent to Rs 1,236.45 as of December 23, 2024.
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SEBI’s investigation revealed that the company’s financial statements appeared to misrepresent its actual state of affairs. Until the financial year ending 2023, Bharat Global Developers reported negligible revenue, expenses, fixed assets, and cash flows. However, its financial results for the March 2024 quarter showed a sharp rise in both revenues and expenses.
The changes coincided with significant business activities, including a management overhaul in December 2023, sizable preferential allotments, and high-value deals. On October 30, 2024, Bharat Global Developers also set up six new subsidiaries, just one day before the lock-in period for preferentially allotted shares expired.
SEBI is reviewing the findings further to ensure compliance with regulatory standards.
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