Sebi summons Rakesh Jhujhunwala over alleged 'insider trading' charges

Securities and Exchange Board of India (Sebi) is probing "insider trading" charges against billionaire investor Rakesh Jhunjhunwala regarding shares of a family-owned education firm, Aptech Ltd.

Apart from the ace investor and Aptech Chairman Rakesh Jhunjhunwala, the market regulator is also investigating the role of his family members, including his brother Rajesh Kumar Jhunjhunwala and wife Rekha Jhunjhunwala, Mint reported.

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Some board members including Ramesh S Damani and Director Madhu Jayakumar have also been reportedly told to cooperate during the Sebi probe. Neither Jhunjhunwala nor the company has come out with an official statement yet.

The probe has been initiated under Section II C(5) of the Sebi Act, which gives Sebi the power to summon individuals regarding a probe.

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Insider trading is the illegal practice of trading on the stock exchange to one's own advantage through having access to confidential or non-public information.

The markets regulator is specifically investigating a time period between February 2016 and September 2016, during which the alleged "irregular trading" was reported with the help of insider information, the daily reported.

Aptech is the only company in the billionaire investor's portfolio in which he has management control.

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As per reports, its shares were locked in upper circuit at Rs 175.05 on September 7, 2016, after his brother and wife bought 7,63,057 shares in the company via block deals. In total, Rakesh Jhunjhunwala holds 24.24 per stake in Aptech, which is valued at Rs 160 crore. His shareholding in Aptech has increased gradually since 2005 when he bought a 10 per cent stake in the firm.

Rakesh Jhunjhunwala manages his own equity portfolio through Rare Enterprises, in which he is a partner. In total, he invests in 24 different stocks, and the estimated value of his entire portfolio is worth Rs 18,000 crore. Among his top holdings are Titan (80.46 million shares), Lupin (7.88 million) and Crisil (4 million).

On Tuesday, Aptech Ltd share price was quoting at Rs 169 apiece, declining 2.54 per cent on Bombay Stock Exchange.

Edited by Manoj Sharma

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