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Ambit Capital pays Rs 6 crore to settle insider trading case with Sebi

Sebi said the information of negative profit for the fourth quarter of FY2012-13 was price sensitive information.

ET Bureau|
Updated: Dec 14, 2019, 08.45 AM IST
Ambit Capital has settled a case of alleged insider trading in Manappuram Finance Ltd shares with the Securities and Exchange Board of India by paying Rs 6 crore towards settlement charges.

The regulator on Friday said it had conducted an investigation into the trading in the scrip of Manappuram Finance Ltd (MFL),wherein it had observed that during the financial year 2012-13 there was negative earnings per share (EPS) during the quarter ended March 2013,wherein the company made a net loss of Rs 141.43 crore. Besides, during the same financial year, there had been a substantial decline in EPS of the company as compared to FY11-12.

Sebi said the information of negative profit for the fourth quarter of FY2012-13 was price sensitive information.

On March 18,2013 MFL had discussions with Ambit Capital on the quarterly financial results.After the meeting, Ambit Capital changed its rating of MFL stock from 'Buy' to 'Under Review' and published a research report based on its meeting with MFL which was distributed to its clients, broking as well as research on March 19,2013 before the market opening hours.

"It is alleged that the applicant (Ambit Capital) which is a market intermediary, was in possession of unpublished price sensitive information and the same was circulated to its clients indirectly by way of negative research report," Sebi said in its consent order posted on its website.

Sebi agreed to settle proposed legal proceedings in the case after Ambit Capital applied for settlement of the matter through consent order mechanism,without admitting or denying the charges.

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