Abhay Bhutada’s resignation comes after SEBI barred him from the securities market for insider trading.
Shares of Adar Poonawalla-backed non-banking finance company (NBFC) – Poonawalla Fincorp – were closed 5 per cent lower circuit at Rs 163.55 for the second consecutive session after it informed exchanges that its managing director Abhay Bhutada Resigned from the board. Poonawalla Fincorp said in an exchange filing that the company will become operational with immediate effect from September 16. Abhay Bhutada will cease to be a Director and Key Managerial Personnel of the Company.
Abhay Bhutada’s resignation comes after the Securities Exchange Board of India (SEBI) banned him and seven others from the securities market for insider trading.
The Securities and Exchange Board of India (SEBI) on Wednesday said in an interim order that managing director Abhay Bhutada was found guilty of sharing information about the proposed stake purchase of Adar Poonawalla-owned Rising Sun Holdings in the company.
Rising Sun Holdings had earlier this year acquired a majority stake in Poonawalla Fincorp, formerly known as Magma Fincorp. At that time Bhutada was the chief executive officer of Poonawalla Finance, a private subsidiary of Rising Sun Holdings. Based on call records, financial transactions and bank statements, SEBI found that several entities related to Mr. Bhutada traded in Magma shares before Rising Sun’s acquisition details were disclosed to the stock exchanges.
Magma Fincorp said it had received shareholder’s approval for acquisition of majority stake in the company by way of preferential issue of up to Rs 3,456 crore by Rising Sun Holdings.
As per BSE data, as of 11:30 am, there were over 9 lakh pending sell orders for shares of Poonawalla Fincorp, with no buy orders.
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