Trading in shares of a Company undergoing CIRP– Whether Restricted?

Trading in shares of a Company undergoing CIRP– Whether Restricted? 2021-05-27

Investors tend to react upon sudden corporate actions, news or events. The quantum of reaction majorly depends upon the level of impact that the said action, news or event may cause. An example of such an event can be initiation of Corporate Insolvency Resolution Process of a listed company. In such an event, the retail shareholders generally try to sell their stocks (to the extent possible) under a fear of the extent of exit payments they will get when the company is under insolvency and the creditors are awaiting their recoveries. In some cases, even the non-public shareholding is also sold and a market based exit route is taken.
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