No evidence of manipulation of ICICI Bank share price: SEBI

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Mumbai, Nov. 20 Investigations carried out by the capital markets regulator show no evidence of manipulation in the share prices of ICICI Bank, said a news release from SEBI.

The bank had in September sought an investigation by SEBI into its share price movement, alleging that rumours were being spread about the bank to deliberately bring down its stock price. The ICICI scrip had started to tank on news of its exposure to Lehman bonds, and although the bank’s CEO had announced that its fundamentals were sound, the fall was not arrested.

SEBI analysed the trading pattern of the shares of ICICI Bank for the period September 8 to October 10, 2008 when the scrip fell 49.52 per cent, from Rs 720 to Rs 363.65.

“SEBI did not find evidence of manipulative trading in the ICICI Bank shares during the period referred,” said the release.

“None of the major sellers were observed to be placing orders successively at lower price. Also there was no pattern observed of booking intraday profits by major clients or brokers during this period.

“By and large, the trading patterns are consistent with the shareholding pattern of ICICI with predominant holdings by FIIs, the general buying and selling behaviour by FIIs and the broad movements of the market during this period.” When contacted, an ICICI Bank spokesperson declined to comment on the SEBI release.

The top 20 investors in ICICI Bank both on net buy and sell basis in the cash market show that majority of them were FIIs. (While 14 FIIs and four mutual funds were net buyers, 17 FIIs and two mutual funds were net sellers.)

FIIs have reduced their holding in ICICI Bank between the quarter ended on June 30 and September 30 by around 3 per cent, from

SEBI also found that the prices of ICICI Bank’s American depository receipts (ADR) fell more (53 per cent) than the shares of ICICI Bank in the Indian market during the period of investigation.

The underlying shares against ADR held by Global Custodian also show a fall of around 20.5 million shares during the period representing January 1, 2008 to September 30, 2008 indicating an increase in the shares available in the Indian market, said SEBI.

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