CASE STUDY // MARUSHIKA TECHNOLOGY
38 red flags. One DRHP.
Zero mutual funds.
A small-cap technology IPO that our forensic agents flagged with 38 red flags — including an active DGGI fraud investigation, circular promoter loans, and fabricated supplier invoices. The IPO proceeded anyway.
Verdict
AVOID
Trust Score
12 / 100
Red Flags
38
Critical Issues
8
Forensic Override
YES
COMPANY OVERVIEW
What the DRHP says vs what we found.
Marushika Technology Limited positioned itself as a technology company in the IPO filing. The reality is more complicated: a company operating from a shop in Mayur Vihar, Delhi, that had changed its name three times, with an active GST fraud investigation, and a capital structure designed to maximize promoter extraction.
Every single red flag we found was disclosed in the public DRHP. It was all there — scattered across 400+ pages of legal text. Nobody connected the dots.
TOP 10 RED FLAGS
Highlights from 38 total flags.
These are the most significant findings. The full report contains 28 additional flags across governance, financial, and operational categories.
Active investigation by Directorate General of GST Intelligence for fake invoices. The company received goods from Smartgen Infra — an entity with no physical presence at its registered address.
Rs 19 Cr in promoter loans that appear circular — money flowing from the company to promoter entities and back. Classic extraction pattern disguised as working capital.
74% of total receivables concentrated in a handful of entities. Cash conversion ratio at 12% — revenue is being recorded but cash is not coming in.
Company changed its name three times in recent years. Each name change coincided with a pivot to a different "trending" sector. Pattern consistent with shell companies seeking IPO valuation.
Company operates from a shop in Mayur Vihar, Delhi. Same address hosts an undisclosed NGO with promoter connections. Not the profile of a technology company seeking Rs 100 Cr+ valuation.
Previous auditor resigned mid-term. No audit trail for several key transactions. Replacement auditor is a small firm with limited listed company experience.
Shares were allotted to promoters at Rs 0.64 per share. IPO price band: Rs 117. That is a 183x markup. Promoters invested Rs 6.4 Lakh for shares now "worth" Rs 117 Cr.
Zero mutual funds in anchor allocation. Lead anchor: Saint Capital, which has participated in 110+ IPOs — a pattern consistent with anchor-for-hire arrangements.
Smartgen Infra, a key supplier, has no physical presence. Invoices from this entity appear fabricated. DGGI investigation ongoing. This alone should disqualify the IPO.
Multiple rounds of share allotment at face value to promoter-linked entities in the 12 months before IPO filing. Value creation for promoters at the expense of IPO investors.
AGENT VERDICT
AVOID — Forensic override triggered.
The Synthesis Agent initially computed a CAUTION verdict based on weighted scores. However, the Forensic Override mechanism was triggered by two independent critical findings: the DGGI fraud investigation and the circular promoter loan pattern. When forensic override activates, the verdict is automatically downgraded to AVOID regardless of other scores.
AGENT PIPELINE OUTPUT
PROMOTER BEHAVIOR AGENT
Trust score: 12/100. Three name changes, shop-based operations, 183x share markup, undisclosed NGO at same address. Pattern consistent with shell company behavior.
RPT MONITOR AGENT
RPT risk: EXTREME. Rs 19 Cr circular loans. Smartgen Infra fake invoices. 74% receivable concentration in connected entities. Extraction probability: 92%.
SYNTHESIS AGENT
Verdict: AVOID. Confidence: 97%. Forensic override: TRIGGERED. Zero mitigating factors identified. Zero mutual fund participation confirms institutional rejection.
THE TAKEAWAY
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