Mishtann Foods Share Price Locked in Lower Circuit For 3rd Consecutive Day

On Tuesday, December 10, 2024, Mishtann Foods share price was locked in the lower circuit limit for the third consecutive session. The stock fell by 10%, closing at ₹8.95 on the Bombay Stock Exchange (BSE). This decline follows the company receiving a show-cause notice from the Securities and Exchange Board of India (SEBI).

The stock had already fallen significantly in the previous 2 trading sessions. On Friday, December 6, and Monday, December 9, the share price hit the 20% lower circuit limit. With today’s decline, the total drop in Mishtann Foods’ share price has now reached nearly 50%.

SEBI’s Show-Cause Notice and Investigation

SEBI has issued a show-cause notice to Mishtann Foods and five of its directors, barring them from accessing the capital markets. This action follows an investigation into the company’s financial practices, conducted by SEBI from April 1, 2017, to March 31, 2024. The investigation revealed alleged financial misrepresentation and fraud.

Allegations of Financial Irregularities

According to SEBI’s findings, Mishtann Foods inflated its sales and purchase figures by creating fake entities. These shell companies were allegedly linked to the company’s managing director, Hiteshkumar Gaurishankar Patel, and his relatives. The entities were reportedly used to transfer funds between Mishtann Foods and its associates, distorting the company’s financial statements.

Mishtann Foods’ Response to Allegations

Mishtann Foods has denied the allegations presented in SEBI’s interim order. The company has stated that its legal team is actively working to address SEBI’s queries and clear up the matter.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. It is based on several secondary sources on the internet and is subject to changes. Please consult an expert before making related decisions.