Description

SEBI adjudication order against Ayusri Health Products Limited (previously Sahul India Limited) for executing non-genuine reversal trades in illiquid stock options at BSE during April 2014 to September 2015, creating artificial volumes.

Summary

SEBI has issued an adjudication order (Order/AK/DS/2025-26/31965) against Ayusri Health Products Limited (previously known as Sahul India Limited, PAN: AADCS7349J) for executing non-genuine reversal trades in illiquid stock options at BSE during the investigation period of April 1, 2014 to September 30, 2015. The entity executed 10 non-genuine trades in 5 stock options contracts, resulting in artificial volume of 38,10,000 units. These trades allegedly violated PFUTP Regulations by creating false or misleading appearance of trading through artificial volumes.

Key Points

  • SEBI investigation revealed 2,91,744 trades (81.40% of all trades) in BSE stock options segment during the investigation period were allegedly non-genuine
  • Ayusri Health Products Limited executed 10 reversal trades in 5 stock options contracts
  • Total artificial volume created: 38,10,000 units
  • Alleged violations: Regulations 3(a), (b), (c), (d), 4(1) and 4(2)(a) of SEBI PFUTP Regulations, 2003
  • Show Cause Notice issued on August 5, 2022
  • Adjudication proceedings initiated under Section 15-I of SEBI Act, 1992
  • Case transferred to new Adjudicating Officer on April 3, 2025

Regulatory Changes

No new regulatory changes introduced. This order enforces existing provisions of SEBI (Prohibition of Fraudulent and Unfair Trade Practices Relating to Securities Market) Regulations, 2003.

Compliance Requirements

  • Entities trading in stock options must ensure all trades are genuine and not create artificial volumes
  • Market participants must avoid reversal trades that create false or misleading appearance of trading
  • Compliance with PFUTP Regulations regarding manipulative, fraudulent and deceptive trading practices

Important Dates

  • Investigation Period: April 1, 2014 to September 30, 2015
  • Initial AO Appointment: July 26, 2022
  • Show Cause Notice Issued: August 5, 2022
  • Transfer to New AO: April 3, 2025
  • Order Number: Order/AK/DS/2025-26/31965

Impact Assessment

Market Impact: Limited direct market impact as the order addresses historical violations from 2014-2015 in illiquid stock options segment. The case is part of SEBI’s broader crackdown on artificial volume creation at BSE.

Entity Impact: Ayusri Health Products Limited (formerly Sahul India Limited) faces potential penalties under Section 15HA of SEBI Act for manipulative trading practices.

Regulatory Significance: Demonstrates SEBI’s continued enforcement against market manipulation schemes, particularly reversal trades in illiquid derivatives that distort market integrity. The investigation covered large-scale manipulation affecting over 81% of trades in the segment during the investigation period.

Impact Justification

Adjudication order against a specific entity for past violations (2014-2015) in illiquid stock options. Limited market-wide impact as it addresses historical manipulative practices of one company. Importance is medium due to enforcement action demonstrating regulatory oversight.