“Trafiksol is directed to refund the money paid by the investors, who have been allotted shares in the Initial Public Offering,” Sebi’s 16-page order said.
The market watchdog has also directed BSE to oversee the refund process in coordination with the bankers to the issue and the refund process must be completed within one week.
Following the refund of the money, the depositories will be required to transfer the allotted shares of the company to a separate demat account opened in the name of the company.
“The Company is directed to take appropriate steps for cancelling the shares which have been so transferred to the account mentioned above by the depositories,” the order said.
Trafiksol ITS is a Noida based company which provides intelligent transportation systems and automation solutions for traffic and toll management projects.About IPO
The company filed a Draft Red Herring Prospectus (DRHP) with BSE on May 31, 2024, for its proposed IPO to be listed on the SME Platform of the stock exchange. The IPO involved fresh issuance of 64.10 lakh equity shares of the company.
Ekadrisht Capital Private Limited acted as the sole Book Running Lead Manager for the issue.
The price band for for the the issue was set between Rs 66 and Rs. 70 per share, and the IPO opened for subscription between September 10, 2024 and September 12, 2024.
The issue was oversubscribed 345.65 times and the listing of the shares was scheduled for September 17, 2024.
Sebi received a complaint was from Small Investors’ Welfare Association – SIREN’ alleging that the objects of the issue included purchase of software valued at Rs 17.70 crore from a vendor which had questionable financials and failed to file its annual financial statements with the Ministry of Corporate Affairs (MCA).
In view of the above complaint, BSE in consultation with SEBI had deferred the listing of the shares.
On October 11, 2024, Sebi ordered an investigation while ordering BSE to maintain the proceeds of the issue in an interest-bearing account till further directions.
The investigation is ongoing and Sebi has to adjudicate on certain other aspects including the allegation that the company has falsified its financial statements.
However, Sebi has allowed Trafiksol to approach the market afresh after the ongoing proceedings initiated by SEBI are concluded, subject to the final order.