Finolex Cables Limited has reported a violation of its Code of Conduct regarding insider trading regulations by a Designated Person (DP). The violation involved contra trades executed without pre-clearance and within six months of prior transactions. The DP has disgorged the profit of ₹423.75 arising from these trades. The company has issued a warning letter to the DP and advised strict compliance with regulations.
Finolex Cables Discloses Insider Trading Violation
Finolex Cables Limited has officially reported a violation of the SEBI (Prohibition of Insider Trading) Regulations, 2015, concerning its Code of Conduct. The violation was identified through a routine review of trading records for the quarter ended September 30, 2026.
Details of the Violation
The reported contra trades were executed by a Designated Person (DP), Mr. Ramesh Mohan Lalwani. The violations include:
- Sale of 3 shares on September 15, 2026, within six months of purchases made on August 31, 2026, and September 07, 2026.
- Purchase of 3 shares on September 28, 2026, within six months of the sale made on September 15, 2026.
Crucially, no relaxation from the contra trade restriction was sought by the DP or granted by the Company. The trades were executed without prior pre-clearance from the Compliance Officer, which is a violation of Clause 8 of the Company’s Code of Conduct.
Actions Taken
In response to the violation, Finolex Cables has taken the following actions:
- An explanation was sought from the DP via letter dated October 26, 2026, with a reply received on October 27, 2026.
- A warning letter was issued to the DP on October 28, 2026, cautioning them to strictly comply with the Code and PIT Regulations in the future.
- The profit of ₹423.75 arising from the contra trades was disgorged by the DP and remitted to SEBI for credit to the Investor Protection and Education Fund.
DP’s Explanation and Company’s Rationale
Mr. Lalwani explained that the trades were executed as part of rebalancing his personal investment portfolios and that he was not in possession of any unpublished price-sensitive information. He also declared that none of his immediate relatives had traded in the Company’s securities during the relevant period.
After considering the DP’s explanation, the company acknowledged that the violation was inadvertent, the quantity and value involved were small, and it was the first such instance for the DP. The voluntary disgorgement of profit by the DP and the warning letter issued by the company signify an attempt to ensure adherence to regulatory norms and internal policies moving forward.
Source: BSE
