In a major stock market development, an Indian investor made $328.6 million with just $1 from LS Industries. The investor, who is a non-resident Indian (NRI) living in Dubai is accused of insider trading and market manipulation. The Securities and Exchange Board of India (SEBI) has stepped in and barred the investor and other entities involved in the fraudulent transaction.

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Stock Market Scam: Several Entities Under the Radar

LS Industries is a Himachal Pradesh-based company with little to no revenue in its balance sheet. Despite having a negative balance sheet, NRI investor Jahangir Panikkaveettil Perumbarambathu (JPP) made $328.6 million by investing a mere $1. SEBI’s interim order shows that the NRI investor acquired 102.8 million shares of LS Industries for just $1. The firm’s promoters Profound Finance, and four other entities collided with the NRI to artificially pump its price. SEBI has now barred LS Industries from trading in the stock market.

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The NRI investor sold the LS Industries shares and wired the money from India to Dubai through the company’s promoters. This move also violates the Foreign Exchange Management Act (FEMA) which SEBI is pressing charges. The fraudulent activity has come as a shock to stock market investors as entities planned a coordinated bogus trading pattern. The crackdown by SEBI will make regular stock market investors of LS Industries funds freeze with no withdrawals allowed.

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The SEBI report shows that JPP sold LS Industries shares at its peak of Rs 267.60 on September 27, 2024. Its price on Wednesday, February 12, 2025, currently stands at Rs 61.34. It is down more than 4x and regular investors are now facing the brunt of the scam which they were never involved in. LS Industries will no longer trade in the charts until an investigation is complete. Reports state that SEBI might bar the company from the stock market entirely.