Manappuram Finance slips as SEBI send notices

The stock of Manappuram Finance experienced selling pressure on Friday. There was buzz in the market that top management executives of the company have received show-cause notices from SEBI regarding an investigation into alleged insider trading activity.

The matter is regarding breach of insider trading norm back in 2013. SEBI has issued show-cause notice to five mutual fund companies including ING Mutual fund, SBI Fund Management, BNP Paribas and Ambit Capital and it Ambit's CEO Saurabh Mukerjee for benefiting from price-sensitive information and indulging in insider trading in the stock of Manappuram Finance Limited (MFL) in March 2013, said a news report in a national business daily.

The Asset Management Companies (AMCs) decided to sell the stock of MFL after receiving a leaked report of Ambit Capital which commented about the Q4 profits of the company. It is suspected that MFL's management informed the fund managers and analysts ahead of the making formal public accouncement regarding the same. SEBI notice states that MFL shared the unpublished and price-sensitive information (UPSI) with Ambit which is a violation of insider trading and corporate disclosure norms.

Reacting to this development, on Friday, the stock of Manappuram Finance was trading at Rs. 131.15 per share, down by Rs. 6.50 or 4.72 at 14:16 hours.