Synoptics Technologies: From Market Blacklist to Legal Lifeline as SAT Steps In

Image Source: Bar and Bench

In a major development, the Securities Appellate Tribunal (SAT) has stayed the operation of the Securities and Exchange Board of India’s (SEBI) interim order against Synoptics Technologies Ltd and its promoters, who were previously barred from the securities market over allegations of IPO fund diversion. The tribunal has also granted liberty to the appellants, including Synoptics and other parties, to file a detailed reply before SEBI, marking a significant procedural reprieve for the company and its management.

Key Highlights:

SEBI’s Interim Order (May 2025): SEBI had restrained Synoptics Technologies and its promoters from trading in the securities market, citing a “well laid out plan” to siphon off IPO proceeds in collusion with lead manager First Overseas Capital Ltd (FOCL). The regulator alleged that over ₹19 crore was transferred as issue-related expenses, a figure grossly disproportionate to the ₹80 lakh disclosed in the Red Herring Prospectus.

Market-wide Ban: The order barred Synoptics, its three promoters, and FOCL from participating in the securities market. FOCL was further prohibited from taking up new merchant banking assignments until further notice.

SAT’s Intervention (July 2025): SAT has now stayed the operation of SEBI’s interim order, allowing Synoptics and other appellants to continue their operations pending further proceedings. The tribunal has specifically permitted the appellants to submit a detailed reply to SEBI, ensuring their right to a fair hearing.

No Immediate Operational Impact: Synoptics Technologies has clarified that there is no current operational impact on the company, though the financial implications of the regulatory proceedings remain unascertained.

Wider Regulatory Scrutiny: SEBI’s investigation also extends to other IPOs managed by FOCL during 2022–2025, raising broader concerns about fund utilization practices in the SME segment.

This stay provides Synoptics Technologies and its promoters a crucial window to present their case, as the regulatory probe into alleged IPO fund diversion continues.

Source: Reuters/TradingView, Economic Times, SEBI, Indian Express