Shares of Reliance Power Ltd, Reliance Infrastructure Ltd and Reliance Home Finance Ltd are in focus on Wednesday morning after the three companies informed stock exchanges that promoter Jai Anmol Ambani has paid Rs 1 crore imposed by the market regulator Securities and Exchange Board of India (SEBI) in its order on September 23, without admitting the liability.
Jai Anmol Ambani was fined as he failed to exercise due diligence while approving general-purpose corporate loans in the Reliance Home Finance matter. While imposing a fine on Jai Anmol, Sebi also slapped a Rs 15 lakh fine on the former Chief Risk Officer of Reliance Home Finance, Krishnan Gopalakrishnan, for approving the loans.
On Tuesday, shares of Reliance Power climbed 5 per cent to settle at Rs 40.06 on BSE. Reliance Infrastructure shares advanced 2.15 per cent to Rs 336.85. Reliance Home Finance settled 4.81 per cent higher at Rs 4.79.
In its order issued on Monday, SEBI said Jai Anmol, a member of the board of Reliance Home Finance, sanctioned general-purpose corporate loans (GPCL loans) despite clear instructions from the board of directors to refrain from doing so. Anmol Ambani approved a loan of Rs 20 crore to Accura Productions on February 14, 2019, contradicting the directive given by the board of directors during their meeting on February 11, 2019, to abstain from approving any more GPCL loans.
"The noticee 1 (Anmol Ambani), as non-executive director of the company, has taken the company in his own direction and has gone overboard in his role as director. Noticee 1 in doing so, gives a hint of being motivated and definitely not in the interests of the shareholders and has not acted with due care and diligence, and has not maintained high ethical standards," SEBI said earlier this week.
Sebi noted Anmol, who was on the board of Reliance Capital and Reliance Home Finance and also a director in the other Reliance ADAG group companies where the funds were onward lent, did not exercise reasonable due diligence with respect to the entire GPCL lending and the onward lending by these GPCL entities to other Reliance ADAG group companies, including Reliance Capital.
The order came after Sebi, in August, barred Anil Ambani and 24 others from the securities market for five years in a case pertaining to the diversion of Reliance Home Finance Ltd's funds. Also, a fine of Rs 25 crore was levied on him.