Vaswani Industries Ltd IPO was closed for subscription on May 03 and share allotment was published on May 12. After the allotment was published on registrar’s website, retail investors were upset to see much more shares they have been allocated then they expected. Even though issue was subscribed 6.83 times in retail, investors got share allotment of equivalent to 1.28 times over-subscription in this category.
SEBI started their investigation after receives complaints from HNI and retail investors.
As per the registrar, investors had either withdrawn their application or their cheque got cancelled after subscribing heavily during the book building process. This has caused unexpected amount of share allotment.
SEBI officials have not given any timeline on results of this investigation. As per SEBI's notice published on its website:
"Post the closure of the issue, SEBI had received complaints from investors regarding irregularities in the subscriptions in the said issue. Based on the data received from the exchanges/registrars regarding the subscriptions/withdrawals and preliminary inquiries into the matter, SEBI has advised the stock exchanges to withhold the listing of securities until further instructions. Inquiries in the matter are in progress. Based on the findings, appropriate action would be taken".
Chittorgarh IPO message board played an important role in this probe as it provided a platform to thousands on Vaswani IPO investors to discuss this matter and contact SEBI officials with their complaint.