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New Shell Company Directive Shakes Up SQS BFSI - Views on News from Equitymaster

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The Equitymaster Research Digest

New Shell Company Directive Shakes Up SQS BFSI
Aug 8, 2017

  • Should Hidden Treasure subscribers worry about SQS India BFSI?
  • An urgent special report sent to subscribers.

The directive on shell companies has caught many by surprise.

To be fair to the regulator, it was a necessary step. Shell companies are a menace to the proper functioning of honest markets.

But the Hidden Treasure team is worried about one of these companies - the 22 March 2017 recommendation.

SQS India BFSI seems to be a fundamentally good company with decent long-term prospects. Never did the team imagine that the stock would be suspended for trading due to this shocking reason.

Here is the management's clarification sent to the stock exchanges...

  • This is in reference to the notification from SEBI with reference number SEBI/HO/ISD/ISD/OW/2017/18183 and dated August 7, 2017 wherein 331 companies have been presumed to be shell companies.

    SQS India BSFI Limited is also on this list and we would like to categorically state that the Company has been following all the rules and regulations as stipulated by the Companies Act, 2013 and the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and other Regulations of SEBI and the Listing Agreement entered into with the Stock Exchanges as well as filing all the required documents within the stipulated time to the concerned authorities. The Parent Company, SQS Software Quality Systems AG, the Promoters hold 53.84%, are based out of Germany, and are also listed on the Alternative Investment Market (AIM) of the London Stock Exchange.

    SQS India BFSI Limited is a Public Limited Company listed on BSE & NSE since October 2009, and have been meticulously filing all the reports with the Exchanges. SQS India BFSI Limited has been a dividend paying company and we do not have any pending complaints with respect to dividend payment.

    We therefore find it quite shocking that the Company has been placed under this surveillance list and we would provide all the necessary details and extend all assistance to co-operate with the authorities and get the matter resolved quickly.

    We would like to bring to your notice that our shareholders will be the most affected in this matter.

    We request you to kindly take this on record and oblige.

    The team participated in the conference call conducted by the management.
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