Fraud Concerns Raise Red Flags for India's Booming Tiny IPOs.

A recent investigation by India's securities regulator has uncovered accounting fraud in two small businesses listed on the country's small and medium enterprises platform. Varanium Cloud Ltd. and Add-Shop E-Retail Ltd. manipulated their financial statements to boost their share prices, resulting in a ban on both companies and their founders from participating in the capital market. This crackdown follows earlier warnings of price manipulation in small initial public offerings (IPOs), and analysts predict that further regulatory action may dampen the gains in the micro listings market. The findings highlight the risks of price manipulation in this segment and the limitations of regulatory warnings in curbing enthusiasm for small IPOs. [Extracted from the article]

Copyright of Bloomberg.com is the property of Bloomberg, L.P. and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder's express written permission. However, users may print, download, or email articles for individual use. This abstract may be abridged. No warranty is given about the accuracy of the copy. Users should refer to the original published version of the material for the full abstract. (Copyright applies to all Abstracts.)