Zombie Shares in Demat Accounts: Why SEBI Needs to Act Now

In this video, Sucheta Dalal delves into the persistent issue of dud shares and the complexities surrounding rematerialisation charges. Despite advancements in the stock market and the transition to a fully electronic trading environment, many investors find themselves stuck with untraded and unlisted shares, also known as dud shares, in their demat accounts. These shares remain in limbo, preventing the closure of demat accounts and incurring annual maintenance fees.
Sucheta Dalal explores how this problem has been overlooked by regulators, despite being brought to their attention multiple times over the years. She shares real-life examples and investor experiences, highlighting the lack of practical solutions provided by SEBI, exchanges, and depositories. From rematerialisation charges to the bureaucratic hurdles faced by investors, the video sheds light on the frustrating reality of dealing with dud shares.
Join Sucheta Dalal as she uncovers the challenges faced by investors and questions whether there will ever be a resolution to this long-standing issue in the Indian stock market. Will SEBI finally address the problem, or will investors continue to be burdened with these zombie shares? Watch the video to find out more.
For more read: www.moneylife.in/article/navi...
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[@TheVishalzxc]

Yes this is a very common issue. Sebi needs to resolve this.

[@Harsaran]

I too have a dud share, and it irritates the hell out of me. Same problem. Thanks for highlighting this issue.

[@MrKhabbu]

How highlighting helps you when you already have suffered.

[@pichaimuthuramachandran9103]

Thankyou very much for taking the issue with SEBI. Hope we get some solution. This is a very nice video. I have more than 6L worth of dud shares from 8 companies, which were very large cap Nifty 50 shares 2 decades back. Couple of these companies are getting bought and their shares will be relinguished soon. When they get relinguished with zero value, they will be removed from demat account and I can account them under LTCG loss. Still 5L worth of dud will be left out. If i tranfer to friends account that poor guy will hold that dud.I may be able to show loss on transfer and close my demat. But that poor fellow has to start suffer like me. Or atleast SEBI should allow us to transfer them back to the company at 1 paise cost and allow us to show the loss for IT purpose, it will be of great help.

[@tejnathsamant741]

I agree with you. Sebi should find way to book loss for dud shares,in both Demat and physical form. Since ltcg is introduced with grandfathering effect from 2018, the loss booking should be possible for pre 2018 shares.

[@Rraj88]

Iam having DHFL share worth of 20k but since not able to close dmat in hdfc bank paying evey year 750 rs. How dumb regulators are.

[@DebDatta]

Not dumb. Callous. They do not care for small retail investors.

[@ajsujit]

@@Rraj88 I was under the false impression that unlisted shares automatically get removed from demat account. This video is eye opener.

[@sphb100]

Get in touch with the company secretary of DHFL now called Piramal Capital and Housing Finance Limited, they will buy it back at current rate.

[@drishtimediratta7004]

DHFL shares are not appearing in Dmat account. Why Piramal capital will pay for it

[@golfergolden]

Close Hdfc bank account, from where HSL shall debit it's charges then

[@factchecker1662]

Very surprising that SEBI chairperson who on TV seems to be a great Chairperson, has not taken up this issue and resolved it. Very strange. Whenever I listen to her, she has always been understanding and willing to listen. Madam Chairperson, if you are watching, please rectify this

[@pankajkamat168]

SEBI only listens but not acts, never in favour of investors, though they pretend to protect investors.

[@ajsujit]

They should publish a demat account where everyone can transfer their dud shares.

[@space99]

Thank you for highlighting this big gap, imagine how much the country pays to maintain such junk holdings.

[@MoneylifeNewsBites]

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[@-doctor_ji]

As an Indian citizen I demand world class services!

[@chiluxr250]

As a Indian? You must be day dreaming. Because it is far from reality and not possible in near future.

[@askme9572]

Do you want to die like Haren Pandiya Dy. CM to Modi , then CM of Gujrat ?

[@sushobhansarker9668]

A much welcome unique presentation on a niche problem of the capital market- dud shares in demat accounts. Appreciate your highlighting of this issue

[@JPSingh-ys7yq]

Glad that SEBI C. said we will take it up. My view is that it is a loss of investment and therefore one should be allowed to treat it as a long term loss in ITR with an appropriate authorisation by Dept of Company Affairs that this is a dud/ vanished/ unlisted company. Plus deletion of share from demat account. Physical shares can be submitted to GOI who can destroy the same. Problem needs to be addressed by FinMin; who is probably more busy gathering revenue, wherever it can be found or generated. My take

[@charlesantony3224]

We should ask SEBI chairperson this question during press conference.

[@vishalsaroha1489]

The Registrar and their role is also a grey area. ..There are shares like Nayara Energy / Essar which went private.if one holds the shares the existing Demat account should facilitate atleast payment of dividend..

[@abhaykinikar5181]

Very very relevant subject, as usual nicely deciphered backed by a studied approach. Thanks for bringing such topics in the world full of cacophony of so call Stock Gurus. Thanks Money Life

[@rajnikantkhardikar3374]

Yes it for this reason that I couldn't close my Demat account but as you said there is a light at the end of the tunnel, I wish sebi responds to your pursuation positively.

[@jagmohanrathi9788]

Thank you so much for bringing this up. I am stuck with one such share and live in hope that the authorities will come up with a solution. Your efforts have always been a catalyst for progressive change.

[@MoneylifeNewsBites]

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[@sabyasachimallick4964]

Again , very good ; thou the topic of show is not interesting , entertaining to Most of us ; BUT IT shows how carefully and detailed Informer you are . My only word of exclamation is-- Alas , if we get Regulator & controller like you !

[@MoneylifeNewsBites]

Appreciate your kind words.

[@jithen]

Wow, you presented such excellent matters that enlightened us. Thank You !!

[@sachinnaik7352]

Thanks for voicing this problem

[@MoneylifeNewsBites]

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[@Kirnotsarg]

1:58 We have suffered from this problem last year. The charges by ICICI direct were nominal, but we had to visit their office many times for the cumbersome process. Thank you for bringing up this issue with multiple authorities persistently. Can you also tell how this problem is dealt with in other countries?

[@jayasreedevineni1679]

Imagine if we do not have channels like these to voiceover, what the outcomes would be! Thank you both Sucheta and Debashish ji for bringing out many issues. If institutes like ICAI take up, much more can be addressed.

[@MoneylifeNewsBites]

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[@MrKhabbu]

Simply pointing out the problem does not help. They must come up with a workable solution for the same. And the greed and the herd mentality of the people which leads them to this trouble .

[@shashankmarri1056]

Excellent work!!!!

[@MoneylifeNewsBites]

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[@rajendrapawaskar2075]

Investor protection fund & SEBI NSDL should collect such shares with them by taking consent from investors to get rid of such shares.

[@deepsleeper]

Thank you, very common issue.

[@ShaishavVora]

Agree with you totally. I too have few dud shares lying in my dmat account & yes no solution as yet 😡

[@jrmohandas2031]

Laudable initiative. Thank you

[@MoneylifeNewsBites]

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[@askm7649]

you have highlight it correctely, problem is sebi is not in problem solving, they are just promoter of share markets, sebi need to work as authority, also sebi needs to open branch office /zonal office in each state like RBI

[@rahulgolikeri1187]

I have two dud shares... Reliance Capital and Reliance Communications in my dp account. It spoils the way my otherwise modest portfolio, looks! The authorities must come up with a suitable solution which should be free if cost for at least a certain number of scrips and holdings. Something like the DEF by RBI... and with the option to be recalled in case the company revives.

[@acchatt]

I hope they take it up earnestly and find a solution. Thank you for taking up a very valid issue.

[@ravindrashenvi8060]

I am also suffering from this zombie stock and one amoung unlucky 9 person out of 10. Might have paid more than 10000 rupees only to maintain 2 zombie shares silverline technology and more emerged company of the same… it carries zero value as on today but i paid more than 10K to maintain.. You have taken right cause, looking forward to seeing the outcome

[@jayanthivenkatesh8537]

Thank you for highlighting a very common problem many of us face .Hope a solution emerges soon.

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[@divewithpraveen]

You got it right i just thinking how to disposed of few dead stocks sitting in my PF /DP. SEBI should find solution to such problems

[@prabhakarv4193]

Very nice and informative. Thank you

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[@straddletrader8906]

As per my knowledge, RTA does rematerialisation, but we won't find an active RTA for defunct company.

[@Vidyasagarbb]

Thanks for addressing this tricky thing. Though I do not want to close my DP, I have 3 such company shares & want to get rid of them.,. Does liquidated shares not get extinguished automatically??

[@koshalgoyal8076]

Best option would be to transfer the shares to IEPF. IEPF is sitting on huge pile of Bluechip shares than why not dud shares ???? As such it is meant for investors protection, isnt it ???

[@MrKhabbu]

What is IEPF

[@SirurP]

Great service to us Sucheta

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[@kayjc0975]

Thanks a lot Sucheta mam.

[@MoneylifeNewsBites]

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[@trpaarvai6545]

Thanks for talking on this topic

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[@sanjaygadhalay1523]

Thank you sucheta a very important topic

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[@vijaypurohit8073]

Thanks for alerting

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[@honest307]

Unless the company is liquidated, one cannot book loss in the capitala gain statement. Generally when NCLT process gets over , the share also disappear from demat account

[@siddharthdas8764]

Great One....Sebi can't brush it away. Is there a solution to this kind of issue in US or Europe?? Then you are also providing a solution !! Probably international best practise for dud shares.

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[@Utop87502]

Appreciate your work @moneylife But this problem happens to investors who bought illiquid junk equity. In investing no one holds a gun to your head to buy shares, people buy junk stuff on their own remit.

[@AV-sh9yz]

Very good video sebi has to act . Pl continue yr good effort.tks

[@MoneylifeNewsBites]

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[@maniavm9628]

Great talk and very helpful

[@MoneylifeNewsBites]

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[@vishalsaroha1489]

Rematerilaize and shred could be an Electronic button option with due backend process

[@rahulgolikeri1187]

Thank you so much for discussing this... i thought i was a unique specimen to be holding 2 dud scrips....

[@MoneylifeNewsBites]

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[@vishalsaroha1489]

Very pertinent issue

[@jvarunkumar]

@ Sucheta Dalal Madam, on a similar note. PLease raise awareness about mutual fund units trapped in demat accounts. A lot of naive investors have bought them in their demat accounts and now they do not know how to sell these units

[@tejnathsamant741]

Please take up this with income tax how we can book loss since now ltcg is being charged from 31 Jan 2018. I hame many shares from 1985 some in physical format and some in Demat. I really appreciate your works for retail investors.

[@vincentpinto1127]

Some junior clown at the NSDL would have given you such a lunatic response!!! Mr Dattar's original suggestion makes a lot of sense. If the stock does get revived, SEBI or responsible govt holder can always transfer back to owner who put it there. I too am stuck with a scrip! Thank you for your persistent efforts. Let's wait.

[@mari3489]

Would filing a PIL be a possible solution to shaking up SEBI?

[@vivek_sura]

Yes it’s high time, SEBI resolves this important issue of dud shares. In addition, as one is unable to trade these shares, how can the capital loss be claimed?

[@felixdsouza8981]

Very good video. Perhaps a solution is list such duds seperately and allow trading with extreme caution

[@MoneylifeNewsBites]

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[@xavierdantis7524]

What happens in case of dud shares in an Estate account, where there is only a one time sell option.

[@mari3489]

Transfer dud shares to SEBI executive's demat accounts😅😅😅

[@Sunilkumar-wk6rs]

Good information which website we can go and clear this issue

[@AR-el1su]

I also have falcon tyre shares .. 200 of them , what I need to do now . Please let me know

[@orientalstocks]

Then one should be allowed to transfer to Govt IEPF acc. Later if company comes alive, the old investor must be allowed to reimburse after opening a new demat acc. A nominal charges can be raised on the value of shares by govt.

[@Derivatives_Hunter]

Great 👍 thanks

[@MoneylifeNewsBites]

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[@shashidharreddy2959]

Company that will be delisted should buy back share at 1 rs or anything automatically.

[@nitinmakhija2999]

Major issue - even global banks are struggling with same process

[@chandubai]

How this dud shares issue is handled by other countries? Like USA Nasdaq ? Any idea ma'am?

[@sureshlalwani410]

Thank you ma'am

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[@apnabini]

Surprised to hear that this is one way street

[@lakshmikanthbhat1060]

Thanks a Ton madam 🙏🙏

[@MoneylifeNewsBites]

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[@aastha222]

How to rematerialise unlisted shares and the company/contact no longer exist

[@REDDYKATIKAM]

Why can't be the same solution like they transfer active shares to Investor protection fund lying for long in DPs but no transactions.

[@bhaskarmukherjee7518]

Sebi is ignoring this problem since 2001. It is 23 years now. In favor of DP i guess. However remat does not worked for me.

[@SanjayKumar-hp3rk]

The problem is there with brokers also. I stopped trading with one beoker and there are no shares in demat or any balance with broker. I informed their customer support to close the account but i keep getting messages on zero balance in my account

[@jintojaimson4381]

I'm stuck with one Zombie " VIVI MED LAB " What should I Do.....? Any Update with This Stock.... I want TAX Reduction because of my " Dead Money " in this Stock....!

[@abstubeindia6979]

i have this issue tooo

[@hindumathisfun]

It is curse of us to have such regulators who have no concern for the problems (created by these regulators) of ordinary small investors. Afterall they remain to safeguard the big corporates.

[@PrabhjotSingh-ku5nv]

Without knowing the market... Even the profit is worst then loss...

[@bm8292]

Thanks Madam

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[@MrKhabbu]

To my knowledge I have a solution for this. Like the unclaimed money from Banks and Insurance and PF and other institutions is transferred to a Escrow account with RBI or Government these dud shares can be transferred to a similar account . RBI and or Government can on their part delve in to the affairs of those companies and if possible recover the cost of maintaining these services. Customer gets relieved once for all.

[@bollywoddance1194]

Very nice new topic... The attitude of government is more like a vasooli agent ...than giving fair treatment to citizens

[@MoneylifeNewsBites]

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[@pharaohakhneton9553]

The problem is that the persons entrusted with the job of governance do not put themselves in the shoes of their target clientele or persons they are supposed to serve.

[@vishalsaroha1489]

What would have one done with Dud shares in Physical share form. This can be done. Electronic shredding initiated by Demat holder through a Button to be approved from DP / NSDL or CDSL could be an option..it can take care of the right s of Share holder and obligations of regulators .

[@pankajgarg06]

Very relevant issue

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[@realtruth9801]

Mam we should file a PIL for it in Supreme Court.

[@sachinnaik7352]

Someone has to raise this question in parliament

[@MrKhabbu]

Raising a question is easy but giving a workable solution is needed. And to raise the same the MP should first understand it

[@64srinidhi]

Dabba trade is increasing, plz make vedio on this subject.

[@kkgupta6114]

Very Valid issue

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[@proffshivramans5346]

When will they take it up is a question only God can answer

[@ganeshpondy1]

Its big issue. I have one bank shares still in my account.

[@user-xr3qi5cc7q]

Rematerialize it

[@johnchristopher2403]

I really wish you become SEBI chair for 1 year.

[@MoneylifeNewsBites]

Appreciate your kind words.

[@VIKASJAIN-no5wt]

I think basic account is a solution, no annual charges

[@kkgupta6114]

Madam , Please write to finance minister

[@ritswik]

Easy solution is to look up the procedure followed by developed first world countries and implement it in India .

[@kumareshbasu-ls6ss]

Only solution is go to supreme court.

[@Jackson_heights94]

👌

[@MoneylifeNewsBites]

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[@MrKhabbu]

Madam instead of just elaborating on the problem come up with a workable solution for the same .

[@vijaypurohit8073]

TRUE they run away with our hard earned money

[@user-se4ri5md1x]

We need a few hundred beacons like you

[@MoneylifeNewsBites]

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[@oflavia2910]

Can we jointly have sebi campaign sign a letter digitally, this is serious, penalising legal tax abiding citizens

[@vidyadhargaikwad4921]

How about Donating shares to temples?

[@balapatil516]

Who is SEBI? Insider fixer. Target retail for loss to make a few rich. SEBI doesn't care about Zombies.

[@sabyasachimallick4964]

Right

[@agnelopereira5856]

Good topic, zombie shares, many more zombies will crowd demat account of retail investors, what with high priced IPOs, or even shares like RVNL or IREDA or IRCTC may turn up to be zombies.😂