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ICSI urges investor caution
April, 03rd 2008
Investors need to do a thorough reality check of the companies before investing in the stock markets, felt experts at the Investors Awareness Programme, organised by the Eastern India Regional Council (EIRC) of the Institute of Company Secretaries of India (ICSI).
 
"It is important that the investors who buy stocks of companies should understand the company's fundamentals. The investors also need to know the antecedents of the promoters and how receptive they are to the sentiments of the stock markets", R Kalidas, company secretary of Ambuja Realty said.
 
Kalidas also cautioned that the investors should neither heed the prevailing rumours in the market nor get carried away by lavish promises made by companies without any proven track record or sound fundamentals.
 
"The investors need to have a heterogenous basket of investment and also ensure that all their stock market transactions are done through depository agents recognised by Sebi", he added.
 
Mukesh Chaturvedi, chairman of ICSI (EIRC), stressed on the need for stepping up awareness among the investors.
 
Chaturvedi referred to the Investor Education and Protection Fund which has been established under Section 205 (C) of the Companies Act, 1956 by way of Companies (Amendment) Act, 1999 for promotion of investors' awareness and protection of the interests of investors.
 
The investors need to keep a vigil on the activities of the companies where they intend to invest and also know the company's promoters and its management, said Anjan Kumar Roy, a practicing company secretary and secretary of ICSI (EIRC).
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