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Reliance: bourses get into the act

BS Markets Bureau in Mumbai | December 15, 2004 08:44 IST

Securities and Exchange Board of India chairman G N Bajpai held a 'review' meeting with the major stock exchanges, the Bombay Stock Exchange and the National Stock Exchange, and the two depositories, the Central Depository Services and the National Securities Depository.

Officials described it as a routine meeting where the ongoing developments in the market came up for review. "Since Reliance is a major issue, it had to be discussed," said an official.

The Reliance 'ownership issue'

But he said the meeting was to provide inputs to the market regulator, which is supposed to present a report to Parliament on the status of the market, along with measures taken to preserve the integrity of the marketplace.

The stock exchanges reported they had sought details from Reliance Industries and other major listed Reliance group companies on decisions taken at board meetings of the companies in the past and whether these were adequately conveyed to investors, in line with the requirements of the listing agreement.

Officials at the BSE and NSE confirmed they had asked for such details and were acting on Sebi's instructions. "We are only doing what Sebi has asked us to do," a senior BSE official told Business Standard.

The four major listed Reliance group companies are: Reliance Industries, Reliance Energy, Indian Petrochemicals Corporation and Reliance Capital.

Exchange officials said a lot of price sensitive information about some Reliance group companies was being reported in the media and most of it seemed to pertain to discussions and decisions at previous board meetings.

"As part of the listing agreement and in adherence with corporate governance norms, it is the duty of the company to make such information public," exchange officials said.

Details of what had allegedly transpired in previous board meetings are now having an impact on the prices of Reliance group stocks. Exchange officials said they had sought details of the most recent shareholding pattern in these companies since this was also price sensitive information.

"Going by reports appearing in various media, this was also causing a lot of confusion among investors," exchange officials told Business Standard.

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