Piramal Enterprises Gets SEBI Warnings Over Shriram Finance Stake Sale

Piramal Enterprises Ltd. received an administrative warning from the Securities and Exchange Board of India on April 2 for non-compliance with certain regulations.

The letter is in connection with the disclosure filed by the company on June 21, 2023, for sale of its investment of 8.34% in the fully paid-up share capital of Shriram Finance Ltd, according to exchange filing.

The market regulator, after considering all the facts submitted by the company, has issued administrative warning to the company stating that the transaction was not considered as UPSI while treating it as material information under Regulation 30 of the SEBI Listing Regulations.

"Thereby, the company has violated Regulation 9(A)(2)(b) of SEBI (Prohibition of Insider Trading) Regulations, 2015", it said.

Earlier, Piramal Enterprises had responded to a query raised by SEBI, stating that the company had informed the market regulatory of its stated position on the stake held by the company in Shriram Group of Companies.

"Since 2019, the company in various fora including investor conference calls (as recent as May 5, 2023), had publicly stated its intention to monetize its investments in Shriram," the filing said.

The company said its decision to divest its stake in Shriram was not UPSI for the above-mentioned reasons and is in the process of responding to the administrative warning so issued by SEBI.

"There is no impact on financial, operation or other activities of the Company pursuant to the abovementioned administrative warning letter," it said.

SEBI has also in its letter stated, the company’s stand on the reasons that why the transaction was not treated as UPSI, the filing said.