Kaynes Technology Shares Plunge After SEBI Issues Show-Cause Notice to MD

Shares of Kaynes Technology India witnessed a sharp decline of 9.6% to an intraday low of ₹3,893.85 on the BSE on 12 March 2025. The drop followed a regulatory notice issued by the Securities and Exchange Board of India (SEBI) to the company’s Managing Director, Ramesh Kunhikannan. The notice pertains to alleged lapses in compliance with insider trading regulations, specifically concerning the maintenance of a Structured Digital Database (SDD) for financial results.

SEBI’s Concerns Over Insider Trading Compliance

SEBI’s official disclosure, dated 10 March 2025, raises concerns over the handling of financial data at Kaynes Technology. The regulator alleges that the company failed to maintain an accurate SDD for financial results related to the period ending 31 March 2023. This is considered a violation of the SEBI (Prohibition of Insider Trading) Regulations, 2015, which mandate strict data management practices to prevent unfair trading activities.

In response to the notice, Kaynes Technology confirmed the receipt of SEBI’s allegations in an exchange filing. The company acknowledged the matter and stated that details of the notice are outlined in Annexure A of the regulatory filing.

Company’s Response and Market Impact

Following SEBI’s action, Kaynes Technology assured stakeholders that it is thoroughly reviewing the notice. The company affirmed that it will undertake all necessary legal and procedural measures, including submitting a formal response to the regulator. It also reiterated its commitment to cooperating with SEBI to address the matter in full compliance with regulatory requirements.

The market reaction to this development was immediate, with the company’s stock experiencing a significant decline. Investor sentiment appears to have been negatively affected by the regulatory scrutiny, reflecting concerns over potential consequences for the company’s governance and compliance framework.

Kaynes Technology Share Performance 

As of March 12, 2025, at 2:15 PM, the shares of Kaynes Technology Ltd are trading at ₹4,316.50 per share, reflecting a surge of 0.59% from the previous day’s closing price. The stock has seen a good recovery from a day low of ₹3,893.95

Conclusion

Kaynes Technology finds itself under regulatory scrutiny after SEBI flagged alleged violations in its insider trading compliance framework. While the company has pledged full cooperation and legal recourse, the market’s reaction highlights the potential impact of such regulatory interventions on investor confidence.

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