Stock manipulation: Birdhi Chand Pannalal Agencies
24 June 2015
Despite terrible financials, the stock price of Birdhi Chand Pannalal Agencies appreciated by more than 3451%, or 36 times in 9 months
Birdhi Chand Pannalal Agencies Limited (BCPAL) was earlier in the textiles business. In May 2015, the management decided to change the name of the company to BPCL International Ltd. Earlier, BCPAL had also announced plans to diversify into financial services and take over control of a non-banking finance company. Further, it plans to apply for a dealership of Steel Authority of India’s products. All this is rubbish. Over the past four quarters, BCPAL reported total revenue of just Rs40 lakh and a loss of Rs11 lakh. Yet, over the past nine months, the stock price appreciated by more than 3451%, or 36 times, to Rs559.25 on 11 June 2015, from Rs15.75 on 8 September 2014. In other words, if you had invested Rs10,000, in just nine months, you would be richer by over Rs3.55 lakh. Just one to four stocks were traded in each trading session over the past year, except in a few bulk deals. Each time, the stock hit the upper circuit. However, from 3 June 2015, the trend reversed direction, hitting the lower circuit in each session. Another pump & dump operation? The regulator doesn’t seem to care. The company has some 1,200-odd shareholders. Who are they?