The aforementioned order issued by SEBI had barred the company from onboarding any new clients for two years.

The news of SAT's stay order provided a strong boost to the company's shares, which zoomed 9.09% to hit the day's high at Rs 65.79.

Over 1.65 lakh shares of the company had changed hands at the counter as compared with an average trading volume of 1.71 lakh shares in the past two weeks.

On 19 June 2023, SEBI had passed an order, which prohibited the company from onboarding new clients for a period of two years in respect of its business as a stock broker.

In an exchange filing made on the same day, IIFL stated that the said order pertains to inspections carried out for different periods from April 2011 to January 2017, which was prior to the issuance of enhanced supervision circular dated 26 September 2016 by SEBI, which was made effective from 1 July 2017.

The SEBI order applies the said circular retrospectively even while confirming that after the circular becoming effective there has been no non-compliance with the same. The said order records: “I find no instance of misuse of clients funds by the noticee placed before me which has occurred subsequent to implementation of enhanced supervision circular dated 16 September 2016.”

IIFL Securities had stated that this order does not affect company's existing business with the existing clients.

On June 20, the company had announced the filing of an appeal against the said order before the Securities Appellate Tribunal (SAT).

"The said order does not levy any monetary penalty, hence there are no direct financial implications. However, the company may lose the opportunity to expand its outreach,” the company had said in a statement.

IIFL Securities, along with its subsidiaries, offers advisory and broking services, financial products distribution, institutional research and investment banking services.

The stockbroker reported 9.4% rise in consolidated net profit to Rs 86.34 crore on a 15.9% increase in revenue from operations to Rs 401.90 crore in Q4 FY23 over Q4 FY22.