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BSE, NSE act against errant Kingfisher Airlines, UB Engineering

Leading bourses Bombay Stock Exchange (BSE) and National Stock Exchange (NSE) have taken action against Vijay Mallya-led UB group firms Kingfisher Airlines and UB Engineering for non-compliance to timely reporting of financial results for two consecutive quarters. The exchanges will shift these companies to restricted trade category or 'Z' segment from 24 September.

Under 'Z' segment, no speculative trading is allowed and delivery of shares and payment of consideration amount are mandatory. In a similar-worded circulars, the exchanges have said that these ‘scrips (Kingfisher Airlines and UB Engineering) will be transferred to 'Z' group with effect from Wednesday, 24 September, 2014, due to non-compliance for two consecutive quarters i.e March 2014 and June 2014 for the Clause-41 of the Listing Agreement.’

Clause-41 of the Listing Agreement deals with non-compliance to timely reporting of financial results.
Apart from Kingfisher Airlines and UB Engineering, BSE will shift another 25 companies including Arihants Securities, Birla Pacific Medspa, Pretto Leather Industries and Best & Crompton Engineering to the restricted trade category.

The National Stock Exchange has also announced similar action against another four companies California Software Company, Surya Pharmaceutical, Goenka Diamond & Jewels and Varun Industries. These companies are also part of the BSE list.

Meanwhile, BSE revised the circuit limits— a range that stocks can trade in—for United Spirits Ltd and 18 other companies, as part of surveillance action. The new limits, which ensure that stock prices do not go up or down beyond a level during a trading session, will be effective from Friday. BSE said in a circular that the price of United Spirits, now controlled by London-based Diageo, can not change by more than 20 per cent in a day.

Also, United Spirits will be replaced by Zee Entertainment Enterprises in the National Stock Exchange’s benchmark index Nifty from tomorrow.

Last month, BSE and National Stock Exchange (NSE) had announced that they will drop United Spirits from futures and options segment as the company failed to submit financial results for the year ended 31 March, 2014 and quarter ended 30 June, 2014 as required under Clause 41 of the listing agreement.

‘No future and option (F&O) contract on the United Spirits scrip shall be available for trading on equity derivative segment of the exchange with effect from 19 September, 2014 onwards,’ the exchanges had said.

Apart from United Spirits, BSE has set an upper limit of 10 per cent for Capital Trust, Omega Ag-Seeds Punjab, UV Boards, JK Tyre & Industries, Hipolin, Piramal Phytocare and Intrasoft Technologies.

The limits for Comfort Commotrade, Rollatainers, Rane Engine Valve, Syncom Healthcare, Welspun Projects, Yashraj Containeurs, Kay Power and Paper, EPIC Energy, Raunaq Automotive Components, T & I Global and Saksoft has been set at 5 per cent.
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