The alleged insider trading predates to early this year when Adar Poonawalla had publicly disclosed his intent to acquire a controlling stake in the erstwhile Magma Fincorp, now Poonawalla Fincorp
Stock market regulator Securities and Exchange Board of India (SEBI) banned managing director Abhay Bhutada of Adar Poonawalla-owned Poonawalla Fincorp from trading in securities market on allegations of insider trading. Seven other people, allegedy involved in the wrongdoing, too have been barred from trading. SEBI has further insituted a collective fine of Rs 13.58 crore.
The other people involved include Saumil Shah, Surabhi Kishore Shah, Amit Agarwal, Murlidhar Bagranglal Agrawal, Rakesh Rajendra Bhojgadhiya, Rakesh Rajendra Bhojgadhiya HUF and Abhijit Pawar.
The allaged violation dates back to when businessman Adar Poonawalla had publicly revealed his intent to acquire a controlling stake in the erstwhile Magma Fincorp. SEBI's order stated its system had received system-generated alerted in the scrip of the erstwhile Magma Fincorp Limited in February 2021, roughly the same time of the acquistion.
"It is noticed that there were phone calls amongst the Entities during the relevant period and the said phones calls were followed by transfer of funds. Further, it is also noticed that persons enjoying connection through phone calls, fund transfers, etc. have traded in the scrip of Magma in advance of the afore-mentioned event i.e. disclosure of the corporate announcement", the order read.