Sebi Promotes Synoptics Tech, Securities Market for IPO Fund Diversion

New Delhi, Market Regulator Sebi controlled Synoptics Technologies Limited (STL) on Tuesday and its promoters of the Securities Market following allegations of IPO income siphoning. Apart from Sinoptics, the company’s promoters Jatin Shah, Jagmohan Manilal Shah and Janavi Jatin Shah were also banned by the regulator.

In the interim order, the regulator said, “The examination has a good plan for the company (Synoptics Technologies) and lead manager, FOCL (First Overseas Capital Limited), to eliminate the funds raised in the IPO.”

“Working under the authority given by the Escrow Agreement, FOCL Prema Facey appears to have issued instructions to the bank for the transfer of funds under the side effects of issue-related costs.

Sebi’s entire member of Ashwani Bahtia said, “The amount of Rs. 80 lakhs was announced in RHP (Red Harring Prospectus), which was apparently transferred to the Commission for Issue Management Fees, Underwriting and Selling.

According to the order, this amount is Rs. 35.08 crore shares are more than 54 % of the total issue of new issues and 35 % of the total issue size (Rs 54.04 crore).

The monitoring of the markets was concluded that the FOCL, who worked with Synoptics Technologies, has forwarded a significant portion of the issue.

Accordingly, Sebi directed the FOCL not to take any new assignments related to commercial banking activities in the securities market, in the next directions of the regulator.

In addition, in the context of any outstanding assignments where FOCL is already engaged as a lead manager, regardless of the size of the issue, he will appoint a monitoring agency to monitor the use of the amount, Order said.

Sebi observed that, from May 1, 2022 to April 30, 2025, an initial public offering ring (IPO) assignment for 20 companies has been handed over to the BSE and NSE SME segment.

The regulator said it would “investigate the use of funds raised in all these issues to identify whether the same modus operandi was adopted in other issues operated by FOCL during this period.”

Mumbai -based Sinoptics Technologies in July 2023 on the NSE SME platform Rs. 54.04 crores, and the FOCL worked as the chief manager of the issue.

The order came after the Securities and Exchange Board India F India (SEBI) investigated the allegations of misconduct in the process of bidding after the IPO was shut down.