SEBI bars Trafiksol and its promoters for one year after a 346-times IPO

The Securities and Exchange Board of India on Friday barred Trafiksol ITS Technologies and its promoters, Jitendra Narayan Das and Poonam Das, from the securities market for one year and fined them a combined Rs 1.05 crore. Trafiksol was fined Rs 30 lakh, Jitendra Das Rs 50 lakh and Poonam Das Rs 25 lakh. They have 45 days to pay.

The order closes an investigation that began after Trafiksol's Rs 44.87 crore SME IPO, a sale of 64.10 lakh shares, was subscribed 345.65 times in September 2024. Complaints to SEBI and BSE focused on the use of proceeds, including Rs 17.70 crore earmarked for software from a firm called Oasis Corpcare. SEBI halted the listing, put the money in an interest-bearing escrow account, then cancelled the issue and ordered a refund with interest. Whole-time member Amarjeet Singh noted that subscribers did not lose principal because the regulator stepped in before listing.

The 85-page final order says Trafiksol inflated FY24 revenue by Rs 22.01 crore through year-end unbilled income and sale and purchase entries involving Limco, Ishira, TP Central Odisha Distribution and TP Western Odisha Distribution. It also flagged purchases of Rs 8.95 crore from Limco and Ishira that the regulator treated as fictitious, and said the way those names appeared in customer and supplier tables hid how concentrated the books were.

On the software line, SEBI found that the promoters relied on a fabricated quotation from Oasis, which it described as a shell without the technical capacity to deliver a Rs 17.70 crore product. Jitendra Das was held directly responsible for obtaining that quote. Poonam Das was held for failing to exercise due diligence when she signed the documents.

The same Friday, SEBI separately barred Debock Industries and managing director Mukesh Manveer Singh from the market for seven years, alleging fictitious preferential issues used to climb from the SME board to the main board, inflated sales and false bank statements. Debock was fined Rs 1.1 crore and Singh Rs 20.1 crore. Reuters also reported that the regulator is considering applying some large-company offer rules to smaller public issues.

Trafiksol is a small intelligent-transport name. The subscription multiple of 346 times is the detail that makes the order more than a private-company story. SME IPOs have drawn retail money on scarcity and on the promise of a listing pop. When the books behind that pop do not survive a complaint, the refund-with-interest outcome protects the application money and still leaves the market with a year-long ban and a published map of how the revenue was built.

Promoters who want another public cheque after August 2027 will have to live with that map. Buyers of the next small-town SME book will have Friday's order as a checklist: unbilled year-end revenue, related counterparties with two names, and a software vendor that cannot be found.