The Securities and Exchange Board of India (Sebi) on Monday suspended trading in Bharat Global Developers Ltd (BGDL) for wrong disclosures, misrepresenting financials, price manipulation and offloading preference shares at inflated prices.

In an interim order, Ashwani Bhatia, wholetime member, Sebi, also barred the company, its managing director Ashok Kumar Sewada, CEO Mohsin Shaikh and directors — Dinesh Kumar Sharma and Nirali Prabhatbhai Karetha — and various preferential allottees of shares from the securities market.

The market regulator also froze alleged illegal profits to the tune of ₹271.6 crore made by the preferential allottees through the sale of shares.

Sebi had initiated an investigation into BGDL following social media posts and a complaint on December 16, 2024 regarding suspicious financials and disclosures by the company.

This came after its scrip saw a steep 105 times jump from ₹16.14 in November 2023 to ₹1,702.95 in November 2024.

The market cop looked into whether the company violated securities laws, including the Sebi Act, Prohibition of Fraudulent and Unfair Trade Practices (PFUTP) Regulations and Listing Obligations and Disclosure Requirements (LODR) Regulations.

Sebi said that examination of complaints and reports with regard to BGDL revealed that the company had five promoters holding 93,860 shares comprising 16.77 per cent of total shareholding till June 2020.

However, from the quarter ended September 2020, BGDL announced nil promoter shareholding and 100 per cent public shareholding.

Later, in December 2023, the management of the company was overhauled.

After this, the company made two preferential allotment of shares – 9.72 crore shares in April 2024 to 31 allottees and 35 lakh shares in August 2024 to 10 allottees.

According to the interim order, these large preferential allotments resulted in 99.5 per cent of the shareholding being concentrated in the hands of the 41 allottees, who were classified as public shareholders.