SEBI finds FOCL's net worth below ₹5 crore for FYs 2019, 2020, 2021

This order addresses a violation by First Overseas Capital Ltd. (FOCL), a registered Merchant Banker, for failing to maintain the mandatory net worth requirement of INR 5 crores during the financial years 2019, 2020, and 2021.

First Overseas Capital Ltd. (FOCL)

• SEBI found that FOCL's net worth was below the statutory threshold of INR 5 crores for FYs 2019, 2020, and 2021.
• The Designated Authority (DA) recommended suspending FOCL's registration certificate for six months and issuing a regulatory censure.
• FOCL admitted to the violation in its replies and attributed the shortfall to accumulated losses and the COVID-19 pandemic.
• SEBI rejected the argument that the pandemic provided an exemption, stating the net worth requirement must be met at all times.
• The order notes that FOCL had previously been penalized for violations of Merchant Banker Regulations.

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