In a case that has sent shockwaves through India’s financial markets, a 22-year-old promoter allegedly executed a Rs36 crore fraud through a Small and Medium Enterprises (SME) IPO.
The Securities and Exchange Board of India (SEBI) has launched a full-scale probe and imposed sweeping restrictions on Nirman Agri Genetics Limited and its young promoter, Pranav Kailas Bagal, for misappropriating IPO proceeds, falsifying documents, and misleading investors.
Fake Vendors, Phantom Firms & Vanishing Funds
SEBI’s preliminary findings paint a picture of deliberate deception. Of the Rs20 crore raised through the IPO, 93% of the funds were allegedly transferred to non-existent or suspicious entities, many of which were controlled by the promoter and his family.
Investigators identified four fake vendors who collectively received Rs12.14 crore. Field checks revealed that these firms had no physical existence or operational activity. One of them, Janvi Trader, was found to have submitted forged documentation to establish legitimacy.
An NSE site inspection confirmed that the addresses listed as Nirman Agri Genetics’ offices were inactive and empty, further exposing the depth of the fabrication.
Promoter Cashed Out Rs16 Crore by Selling Shares
Adding to the controversy, SEBI discovered that Pranav Bagal offloaded a massive 8.6 lakh shares, generating approximately Rs16.08 crore—even as the company’s financial condition deteriorated.
Between September 15 and 23, 2025, Bagal’s shareholding dropped from 65.59% to 44.33%, raising serious red flags about insider motives and investor manipulation.
Bonus Issue and Stock Split to Mislead Investors
In an apparent move to create artificial excitement in the market, the company announced a 1:10 bonus issue and a 1:10 stock split.
SEBI believes these corporate actions were designed to inflate liquidity and distract investors from the company’s internal financial distress.
Adding to the confusion, Nirman Agri Genetics proposed changing its name to “Agriicare Life Crop Ltd.”, a rebranding that regulators say was intended to mislead shareholders and distance the firm from the ongoing irregularities.
SEBI’s Swift Crackdown
Taking strong preventive action, SEBI has:
●Suspended all securities market activities of Nirman Agri Genetics Ltd.
●Frozen the promoter’s ability to buy, sell, or transfer shares.
●Halted all ongoing processes related to bonus issues, stock splits, and name changes.
The company and its promoter have been granted 21 days to respond, as SEBI continues an in-depth forensic investigation into fund diversion and possible insider trading.
Expert View: “Digital Deception Is Evolving Faster Than Detection”
Speaking on the case, Prof. Triveni Singh, a renowned cybercrime expert and former IPS officer, said:
“This case highlights how corporate frauds are becoming digitally sophisticated. The use of fake vendors, fraudulent documentation, and manipulative tactics like bonus issues and stock splits reflects a well-planned financial deception.”
He added,
“Regulatory vigilance must be backed by real-time data forensics. Investors should verify company fundamentals and not get carried away by IPO hype or social media buzz.”
Prof. Singh further warned that in the era of digital finance, fraudsters are exploiting technological loopholes and public naivety, calling for enhanced investor education and AI-based surveillance systems to detect irregular financial activity.
The Bigger Picture: A Wake-Up Call for India’s SME Market
The Nirman Agri Genetics case serves as a grim reminder that even the SME segment—touted as the engine of India’s growth—is not immune to manipulation.
A 22-year-old’s audacious scam, if proven true, not only shakes investor confidence but also highlights the urgent need for stricter corporate governance and early-warning mechanisms for fraudulent IPO activities.
As SEBI tightens the screws, the financial community watches closely—hoping that this crackdown marks a turning point in cleaning up India’s emerging capital markets.
