Description

SEBI issues ex-parte interim order against 8 entities for alleged insider trading in Indian Energy Exchange Limited (IEX) scrip following CERC announcement on July 23, 2025.

Summary

SEBI has issued an ex-parte interim order under Sections 11 and 11B of the SEBI Act, 1992 against 8 entities for alleged insider trading in the scrip of Indian Energy Exchange Limited (IEX). The action stems from a suo-motu preliminary examination conducted after a significant price fall in IEX shares following a CERC announcement on July 23, 2025. An Investigating Authority was appointed on September 12, 2025, and search & seizure operations were conducted pursuant to an order from the Hon’ble Special Court.

Key Points

  • 8 entities named as Noticees: Bhoovan Singh, Amar Jit Singh Soran, Amita Soran, Anita, Narender Kumar, Virender Singh, Bindu Sharma, and Sanjeev Kumar
  • Investigation period: July 01, 2025 to August 14, 2025
  • Trigger: Significant price fall in IEX scrip after CERC announcement on July 23, 2025 (after-market hours)
  • SEBI also received a complaint alleging insider trading in the scrip
  • Investigation includes examination of UPSI origin, connections amongst Noticees, communication of UPSI, trading activities, profits made, and fund flow analysis
  • Search and seizure operations conducted at different locations pursuant to Special Court order
  • Order issued under sub-section (1) of Section 11, sub-section (4) of Section 11, and sub-section (1) of Section 11B of SEBI Act, 1992
  • Action taken under SEBI (Prohibition of Insider Trading) Regulations, 2015

Regulatory Changes

No regulatory changes announced. This is an enforcement action against specific entities.

Compliance Requirements

  • The 8 named Noticees are subject to ex-parte interim restrictions (specific restrictions detailed in the order)
  • Entities are expected to cooperate with ongoing SEBI investigation
  • Market participants should ensure compliance with insider trading regulations and maintain proper Chinese walls
  • Listed companies must ensure robust UPSI handling and disclosure protocols

Important Dates

  • July 01, 2025: Start of investigation period
  • July 23, 2025: CERC announcement (after-market hours) triggering price fall in IEX scrip
  • August 14, 2025: End of investigation period
  • September 12, 2025: Investigating Authority appointed
  • October 16, 2025: Ex-parte interim order issued

Impact Assessment

Market Impact: High - The order involves insider trading allegations in IEX, a significant listed entity. The significant price fall following the CERC announcement and subsequent enforcement action may affect investor confidence in the scrip and highlight risks of information leakage ahead of regulatory announcements.

Regulatory Impact: High - This enforcement action demonstrates SEBI’s proactive approach to market surveillance and willingness to take swift interim action, including search and seizure operations, in suspected insider trading cases. The ex-parte nature of the order indicates urgency and seriousness of the alleged violations.

Operational Impact: High for named entities - The 8 Noticees face interim restrictions pending investigation completion. For broader market participants, this reinforces the need for strict compliance with insider trading regulations, particularly around handling of UPSI related to regulatory announcements.

Investor Impact: The order serves as a warning about illegal trading practices and SEBI’s enforcement capabilities. Investors should note the regulatory scrutiny on trading patterns around material announcements and ensure their own compliance with applicable regulations.

Impact Justification

Major enforcement action by SEBI involving insider trading allegations against 8 entities in IEX scrip, with search and seizure operations conducted. Ex-parte interim order issued under Section 11 of SEBI Act indicating serious regulatory concerns.