Manappuram Finance Limited disclosed a breach of its code of conduct related to insider trading rules involving a transaction conducted through the portfolio management services account of one of its independent directors. The trade in question was associated with Abhijit Sen, an Independent and Non-Executive Director who also chairs the Audit Committee. The transaction, which occurred on February 3, 2026, entailed the purchase of 2,111 shares valued at approximately Rs 6.15 lakh.
Manappuram Finance explained that the trade occurred due to an operational error by the PMS provider, despite specific instructions from the director to restrict trading in the company’s shares. The securities were meant to be categorized as “prohibited” to prevent any transactions, but this control was not correctly implemented at the system level. The company clarified that the director was not involved in executing the trade and did not authorize it.
The director affirmed that he had no access to undisclosed price-sensitive information at the time and had no intention of breaching insider trading regulations. However, the trade lacked prior approval from the compliance officer, mandatory for transactions exceeding a certain threshold under SEBI (Prohibition of Insider Trading) Regulations, 2015. Following an internal review, the company deemed the incident a technical and unintentional violation.
After investigating the matter internally and presenting it to the Audit Committee and the board, the company considered it a technical and inadvertent breach. The director was asked to provide a written explanation, and a penalty of Rs 20,000 was imposed in accordance with the company’s internal code of conduct. The penalty amount was deposited into the Investor Protection and Education Fund of Securities and Exchange Board of India on April 7, 2026. Manappuram Finance also confirmed that no similar breaches had been reported since the previous fiscal year.
