Growpital Update - 03-Feb-2025

Summary

The transcript covers the 13th hearing between SEBI and Grow Pidil on February 3rd, 2025, regarding the return of ₹52.5 crores locked in escrow since January 2024. The case, which has spanned over a year, now includes a surprising development: a new investor has agreed to take over Grow Pidil, including its liabilities and the funds owed to investors. This shift offers new hope for the recovery of the funds, but the identity of the investor remains undisclosed. SEBI was only notified of the proposal recently and has requested more time to review it, with the next hearing scheduled for February 25th, 2025.

Takeaways

• 😀 The hearing on February 3, 2025, marks the 13th hearing between Grow Pidil and SEBI.
• 😀 SEBI had initially frozen Grow Pidil's bank accounts on January 29, 2024, affecting the company's business and investors.
• 😀 Over a year later, 12 hearings have taken place regarding the matter.
• 😀 The most critical hearing was on September 19, 2024, where both parties were asked to devise a plan for returning investors' money.
• 😀 Approximately ₹52.5 crore is locked in an escrow account, earning no interest, causing investors to lose value every day.
• 😀 Both Grow Pidil and SEBI have nearly agreed on a plan to return the money to investors.
• 😀 The formal plan needs to be presented before the tribunal to obtain approval and proceed with the return of funds.
• 😀 During the February 3 hearing, a significant revelation was made by Grow Pidil’s lawyer about a new investor taking over the company.
• 😀 The new investor has agreed to assume full responsibility for Grow Pidil, including the liabilities and returning the funds to investors.
• 😀 The identity of the new investor has not yet been disclosed, and SEBI requested more time to review the proposal.
• 😀 The case will be further discussed during the next hearing on February 25, 2025, with the hope of getting closer to resolving the issue.

Q & A

What is the context of the hearing mentioned in the script?

The hearing is a legal proceeding between Grow Pidil and SEBI (Securities and Exchange Board of India), taking place on 3rd February 2025. It involves the return of investor funds which have been locked in escrow accounts for over a year due to a freeze order passed by SEBI against Grow Pidil.

What was the key issue discussed in the 19th September 2024 hearing?

The critical issue discussed was finding a way to return approximately 52.5 crore rupees that had been stuck in escrow accounts for over a year, which had not been earning any interest. The court directed both parties to devise a solution to return the money to the investors.

What was the new development revealed during the hearing on 3rd February 2025?

A new investor has agreed to take over Grow Pidil along with its liabilities, which includes the return of funds to the investors. This shift to a merger and acquisition scenario opens a new hope for the investors to recover their money.

Why was the hearing postponed until 25th February 2025?

The SEBI lawyer was informed about the new proposal only two days before the hearing, on 1st February 2025. As SEBI needed more time to examine the proposal, the next hearing was scheduled for 25th February 2025.

What amount of money is stuck in the escrow accounts, and why is it important?

An amount of 52.5 crore rupees is stuck in escrow accounts. This money is important because it has been locked for over a year, earning no interest, causing financial losses for investors every day.

What was Grow Pidil's proposal to SEBI on 24th January 2025?

Grow Pidil proposed a new plan to SEBI on 24th January 2025, which involved returning the investors' money. This proposal came with the involvement of a new investor who agreed to take over the entire company and its liabilities.

What is the significance of the new investor in the case?

The new investor is significant because they have agreed to handle Grow Pidil's liabilities, including the responsibility of returning the locked-up funds to the investors. This introduces a potential resolution to the long-standing issue of investor compensation.

How did SEBI respond to Grow Pidil’s new proposal?

SEBI responded cautiously as it only received the notice about the new proposal on 1st February 2025, just two days before the hearing. As such, SEBI requested more time to inspect the proposal before moving forward.

What was the role of the lawyers during the hearing?

The lawyers from both sides, Mr. Manish from SEBI and Mr. Kunal from Grow Pidil, presented their respective arguments. Grow Pidil's lawyer revealed the new proposal, while SEBI’s lawyer requested more time to assess it.

What does the new proposal by Grow Pidil entail?

The new proposal involves a merger and acquisition scenario where a new investor takes over Grow Pidil, including its liabilities, and ensures the return of investor funds, including those stuck in escrow accounts.