Why are penny stocks like CALS Refineries not delisted from BSE?

fireboltt

PQ
PolicyQuestion
Posted 5 days ago
I dont understand why companies like CALS Refineries, which have zero business and are involved in scams, are still allowed to trade on BSE?

Why doesnt SEBI or BSE delist such zombie companies? They only trap innocent retail investors. What is the regulatory logic behind keeping them listed?

fireboltt

RegulationExpert_RS SENIOR
Posted 5 days ago
Good question. The delisting process in India is quite complex and lengthy.

For compulsory delisting, exchange needs to follow proper procedure which can take years. Also, there are legal challenges from promoters/shareholders that delay the process.

In case of CALS Refineries:

Company is under GSM Stage 6 (maximum surveillance)
Trading is heavily restricted
SEBI has taken action against promoters in past
Delisting process may be ongoing but stuck in legal issues

Meanwhile, BSE has put maximum restrictions to warn and protect investors. The GSM framework itself acts as a warning system.

fireboltt

NaveenKulkarni
Posted 5 days ago
I think SEBI should be more strict and delist all such companies immediately. Keeping them listed even with GSM restrictions allows scamsters to exploit new investors.

Many first-time investors dont even know what GSM means. They just see low price and buy thinking its cheap.

There should be automatic delisting if company has zero revenue for 3 consecutive years.

fireboltt

AnilMehta_CA
Posted 4 days ago
From legal perspective, delisting requires following due process. Even if company has no business, shareholders still have rights.

However I agree with @NaveenKulkarni that process should be faster. Currently it takes 5-10 years to delist a company which is ridiculous.

As investors, we should educate ourselves. Before buying any stock:

Check if its under GSM
Read latest financial results
Check promoter background
Avoid stocks with zero revenue

CALS Refineries fails on all these parameters. Simple due dilligence would have prevented losses.

fireboltt

c
DeepakJoshi
Posted 4 days ago
Bottom line - doesnt matter why CALS Refineries is still listed. What matters is WE should not buy such junk.

There are 1000s of good companies to invest in. Why waste time and money on scam stocks?

If something looks too good to be true (like 20x returns promise on penny stocks), it usually is a scam!