Dear Friends..
Many of you are aware and at least some of you already experienced the pain and difficulties created by the Periodic Call Auction introduced by SEBI in the Month of April.More than 2000 shares already shifted to this mechanism and many are expected to follow in the next round.Not even 500 companies are regularly trading now after this shifting and market cap of many companies cut by more than 50% only due to lack of liquidity post implementation of this system.Since, re-entry of orders in each hours creating many practical difficulties, lot of broking firms are not even accepting orders for such scrips.Actually SEBI introduced this mechanism to save investors from price manipulation and low liquidity ,but it clearly turned as counterproductive .Even the lack of clarity in circular reading the penalty clause and non introduction of the concept of ‘market maker ‘ ensures the failure of this new method.
Many individual investors including me and my friends , and investor groups are trying their level best to inform the practical difficulties of this method to SEBI and requesting a withdrawal of this mechanism.We have even personally met some SEBI officials to clear our stand. Some well known personalities in investor’s world like Ashish Chungh presented his concern about this system through CNBC.( Link HERE). You all know ,media attention and support of more retail investors are necessary to make it a success.Unfortunately ,media and people with influence are generally not interested to take up such matters which affecting only retail investors.Only one rare exception is Mrs Suchetha Dalal of Money Life.She is a Business Journalist and winner of Padma Shri for journalism in 2006. She is the last word in the investigative business journalism in India and credited for the braking of the securities scam 1992. She along with her husband Debashis Basu wrote the famous book ‘The Scam: From Harshad Mehta to Ketan Parekh.’ As far as my understanding ,she and her money life foundation is the rarest of the rare who stands boldly for the retail investor's rights. Recently she wrote some bold articles to point out the negatives of Periodic Call Auction and express her willingness to take up this matter if it is an issue affecting a large number of retail investors.
Below I am providing the link of her recent article on this matter.
What we need is your 5 minutes to share your experience about this anti retail investor move ,as a comment on this article (Many investors including me already done it). By reading the already appeared comments you will get a clear picture of the current situation.
Also I requesting you to send e-mails to SEBI indicating the practical difficulties of this system.If SEBI realises the implication of PCA on retail investors ,they may take a favourable decision.I believe, it is the duty of us as small and mid cap investors and we have no right to criticise the continuity of this system if we have no time to spend at least 5 minutes for this purpose.
( E-mail ID link of SEBI officials including chairman in available in this link -
Read other articles by moneylife about this subject below:
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