Lets talk about modern-day financial scams involving the manipulation of stocks through price hikes, fabricated business claims, and misleading disclosures.
Bharat Global Developers Ltd (Bharat Global), was involved in a financial scandal where their stock was manipulated through price hikes, fabricated business claims, and misleading disclosures.
This “pump-and-dump” operation involved a small group of operators cornering almost all shares and artificially inflating stock prices from ₹16 to ₹1,702. The Securities and Exchange Board of India (SEBI) intervened, suspending trading due to these manipulations. Despite this, Bharat Global tried to resume trading by claiming new management, leading to concerns about the potential for further manipulation. The company admitted to false claims about large orders and faced scrutiny over its financial disclosures.
What Happened?
The stock of Bharat Global went from Rs16 in November 2023 to Rs1,702 in November 2024—over 100 times higher! This is not normal and made people suspicious. The company said it got big orders from famous companies like Reliance, McCain, and Tata, including Rs155 crore from Reliance. But later, they admitted most of these claims weren’t true. Social Media Tricks were also used by the company. People used platforms like X, YouTube, and Instagram to hype up the stock, saying it could reach Rs5,000. A company paid influencers Rs45 lakh to spread this buzz, but many weren’t properly registered.
The company allotted approximately 99.5% of its shares to 41 individuals through preferential share offerings at significantly discounted prices. Once the mandatory lock-in period ended, these allottees sold their shares at inflated market prices, realizing substantial profits. For instance, one investor turned a ₹49 lakh investment into ₹70 crore.
This is a trick where someone makes a stock price go up with fake news or excitement (the “pump”), then sells their shares at the high price (the “dump”), leaving others with worthless stock. It seems Bharat Global was part of this game.
What Did SEBI Do?
After the scandal came to light, SEBI took action and suspended trading. In December 2024, SEBI (India’s stock market regulator) stopped people from buying or selling the stock because of fake financial reports. They locked Rs 271.6 crore that some people made illegally from this scheme. 17 company officials, like the CEO and directors, were banned from the stock market by SEBI. As of the latest update, In March 2025, SEBI said BGDL could start trading again on April 15, 2025, fulfilling the condition to share the real financial details.
This case of BGDL and use of ‘Pump and dump’ highlights the sophisticated methods employed in modern market manipulation schemes and underscores the importance of vigilant regulatory oversight to protect investors. India’s stock market rules need to be stronger to stop this from happening again as Regular people who bought the stock thinking it was a good deal lost money when the truth came out are at great risk in such cases.
