Huge Insider Trading in Sabero Organics as Promoters Chuganees sell out to Coromandel International this morning ?..BSE and SEBI need to quickly investigate and Leading Newspapers need to quickly highlight

This morning Sabero Organics hit upper circuit on BSE at Rs 97.90 as news officially broke that that the Promoters Chuganees were selling out in toto their full 42.22 % Equity to Coromandel International (CI),a Muruggapa Company at Rs 160 a share + Rs 38.47  non compete component too => Rs 198.47  

http://www.expressindia.com/latest-news/Coromandel-Intl-to-buy-Sabero-Organics/797511/

CI will also offer to buy out another 31 % of the Equity from the remaining shareholders for a   total stake of 73.22 %

But this sell out by the Chuganees was known to insiders a fortnight earlier this month….look at the trading pattern below on BSE from May 16,2011  to date….clear case of Insider Trading……Sabero was languishing below Rs 60,low volumes and number of trades and then a sudden burst of Volumes and Trades and intermittent upper circuits from May 16,2011

From Daily Turnover of Rs 20 lakhs to Rs 30 lakhs the turnover bursts into Rs Crores from May 16,2011…in fact in just 12 trading days from May 16,2011 to date May 31,2011 the BSE Turnover aggregated Rs 127 crs + in Sabero Organics…could have been more if upper circuits were not hit…..standing out are the Tuesdays May 17 and May 24….38 + lakh shares aggregating Rs 29 crs + and near 28 lakh shares aggregating near Rs 25 crs respectively…and today too is a Tuesday when the announcement was made….Insiders probably are great ‘bhakts’ of ‘Siddhivinayak Lord Ganesha’ ! 

So who leaked the sell out by Chuganees to the Muruggapas at thrice the market levels of Rs 60 before the announcement this morning…..only three root sources could be there….Someone close to or in Sabero Organics,someone close to or in Coromandel  or someone close to or in the Investment Banking and Valuation team who are advising and involved in the deal…and as deals have to be put through Brokers,it is logical to assume even involvement of Brokers in this……..

incidentally the Valuation of Rs 160 is simply terrific…thrice the market price levels of Rs 60……wonder who did this and what is the basis….and is there some hidden agenda in such a high valuation to market price ?

With insider aggregate BSE turnover at Rs 127 crs + and aggregate Volumes of 1.56 crs shares for last 12 trading days and observing weighted average prices and daily volumes,I can safely observe that in just twelve trading days already Rs 40 crs + profits at the BSE have been accumulated  with the promise of this figure likely to cross Rs 100 crs in the coming days

CI is paying Rs 284 crs at Rs 198.47 for 14.29 million shares or 42.22 % of Equity held by the Chuganees….In addition they will offer Rs 168 crs more to acquire another 31% at Rs 160 from the other shareholders…so the total cost of their 73.22 % stake will be Rs Rs 452 crs

So Insider Profits of over Rs 100 crs against a Deal Size of Rs 452 crs is simply stunning ….In fact Sabero is also listed on NSE…so it is likely that Insider Profits will probably even exceed even deal size ! 

Will be surprised and suspicious if SEBI overlooks this……They simply have to investigate which insiders have been buying since May 16,2011….should be a Open and Shut Case really

Interestingly on May 27,2011 Sabero Organics announced their FY 11 Performance signed by Executive Vice Chairman Sumeet H Chuganee….not to good really a performance…it was relayed to BSE early on Saturday,May 28,2011 as the Sabero Letterhead Pages indicates,although amusingly BSE shows this posted on May 27,2011 itself at 19.00 hours…there is no mention or hint of a sell out….and such results would never have sparked off a buying spree in Sabero….

http://www.bseindia.com/stockinfo/anndet.aspx?newsid=edaeb0d4-d382-4431-be43-92398682cd26

….and till this evening past 9 pm as I blog this there is no news announcement posted on the BSE website of this sell out announced this morning

Another strong case for my assertion that Insider Trading and India are inseperable ?….destroys the sanctity of our markets…and is grossly unfair to those who sold out to the insiders in the last twelve days between Rs 60 and Rs 90…they would not have if they knew of this sell out at Rs 160….maybe they should approach SEBI strongly on this 

Company : SABERO ORGANICS GUJARAT LTD. ( 524446 )   
Period   ( 12-May-2011  to  31-May-2011 )  

Date

Open
Price

High
Price

Low
Price

Close
Price

WAP

No. of
Shares

No. of
Trades

Total Turnover
(Rs.)

 
 
12/05/11

58.70

60.40

58.60

59.15

59.11

57,082

530

33,74,175

 
13/05/11

60.15

60.45

57.50

57.80

58.74

31,043

325

18,23,523

 
16/05/11

58.00

69.35

58.00

*69.35

68.19

6,85,599

4,584

4,67,51,202

 
17/05/11

70.10

82.30

70.10

78.40

76.83

38,17,507

28,946

29,33,05,492

 
18/05/11

77.90

79.70

71.10

77.70

75.58

17,54,970

15,697

13,26,46,529

 
19/05/11

78.00

82.50

76.25

80.15

80.16

17,11,895

14,736

13,72,23,286

 
20/05/11

80.60

82.25

77.50

79.10

80.49

9,11,964

8,934

7,34,06,980

 
23/05/11

78.10

83.70

76.30

82.85

81.16

8,43,078

6,795

6,84,24,567

 
24/05/11

82.90

92.40

82.35

90.85

89.08

27,99,286

25,415

24,93,68,679

 
25/05/11

91.50

93.25

88.35

90.25

91.46

9,63,954

8,487

8,81,66,012

 
26/05/11

90.95

92.10

88.05

89.90

90.03

5,08,947

4,117

4,58,21,677

 
27/05/11

89.95

91.80

80.95

80.95

87.48

3,76,970

2,544

3,29,76,178

 
30/05/11

77.40

89.00

73.60

*89.00

85.24

8,18,342

3,985

6,97,55,662

 
31/05/11

94.00

97.90

90.80

*97.90

96.08

4,07,913

1,503

3,91,91,240

 

* Upper Circuit Closing 

Added on Thursday,June 2,2011

BSE has just put up this notice on it’s website this morning

Promoters’ Agreement with Coromandel International Ltd | 02/06/11 10:26 

 

Sabero Organics Gujarat Ltd (SOGL) has informed BSE that the on May 30, 2011, Promoters of the Company as listed in Table 1 have executed an agreement with Coromandel International Ltd, a part of the Murugappa Group for the sale of 14,298,112 Equity Shares of Rs.10/- each representing 42.22% of the paid-up capital of the SOGL.
– Promoter Group Sellers:
1. Hero Chuganee
2. Mohit Chuganee
3. Sumit Chuganee
4. Sabita Chuganee
5. Harvard Finance Company Pvt. Ltd.
6. Sabero Echostar (India) Pvt, Ltd.
7. Karville Company Ltd.

So of the Agreement was executed only this Monday,May 30,2011 and announced too the same day then who has been executing HUGE insider deals from Monday,May 16,2011 on BSE  from Rs 58 onwards and has already made over 100% gains and counting inside a forthnight?

Today ,Thursday, June 2,2011 the price of Sabero is yet again locked on 10% upper circuit at Rs 118.40 on BSE and Rs 119.05 on NSE as deal has been done at Rs 160

BSE Survelliance and SEBI have to get into the act fast to protect minority shareholders who unawaringly sold out their Sabero Holdings to Insiders in the second half of May 2011 not knowing of this Promoter sell out at thrice the price !

I’m really shocked that neither the regulator or the Exchange nor leading papers have reported or highlighted this Insider Trading…..it’s not that they are blind ! ….Enam Securities Private Ltd has released a full page (Page 12) advertisement in the Smart Investor section of the Business Standard Newspaper today which is the Public Announcement for the Attention of the Equity Shareholders of Sabero Organics Gujarat Ltd ,for and on behalf of Coromandel International Ltd for a Cash Offer of Rs 160/share to acquire another 31% of the Sabero Equity  

7 thoughts on “Huge Insider Trading in Sabero Organics as Promoters Chuganees sell out to Coromandel International this morning ?..BSE and SEBI need to quickly investigate and Leading Newspapers need to quickly highlight

  1. Dear Popat….teri ‘insider trading’ ki baat bilkul sahi hai…aur yahi kaaran market may ‘Crisis of Confidence’ or ‘Integrity of Operations’ kay issues khadein ho jate hai…..and retail investors fear to enter Equity or wash their hands off it…..Sad….. I’m not after Sabero…just that survival and sustenance and Healthy Growth of Stock Markets depends on preserving the sanctity of the markets….Sabero Incidence,like many others,are setbacks in this effort…..Appreciate your intense and passionate response…sorry,had to edit out your expletive and vituperative salutation….Cheers !

  2. Great Sir! Sebi charged the chairman of Murguppa Group. But unfortunately judgement made on peanuts of overall share traded. There seems to be lot more trades based on inside information.

  3. Yes Prasad ! they caught the ‘Paisa’ now they need to catch the ‘Rupee’…have blogged today again on this SEBI Order…check it out

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