Sebi Bans Entities for IEX Insider Trading

New Delhi, Oct 15 (PTI) Markets regulator Sebi on Wednesday barred eight entities from the securities markets and impounded illegal gains of Rs 173.14 crore made by them through insider trading in the shares of Indian Energy Exchange Ltd (IEX).

"I am of the prima facie opinion that the noticees (eight entities) had access to the UPSI pertaining to the CERC order, and based on the trading pattern of the noticees, an irresistible inference can be drawn that their trades, being insiders, were influenced by the possession of UPSI," Sebi Whole-Time Member Kamlesh Varshney said in his 45-page interim order.

The entities barred by Sebi are -- Bhoovan Singh, Amar Jit Singh Soran, Amita Soran, Anita, Narender Kumar, Virender Singh, Bindu Sharma, and Sanjeev Kumar.

The case traces back to July 23, 2025, when the Central Electricity Regulatory Commission (CERC) issued directions for implementing Market Coupling under the provisions of the Central Electricity Regulatory Commission (Power Market) Regulations, 2021. The implementation of this mechanism was expected to negatively impact the trading volumes on Indian Energy Exchange Ltd. (IEX).

As anticipated, following the announcement, IEX's share price fell sharply by 29.58 per cent on July 24, 2025, on a close-to-close basis. The steep fall in price, accompanied by a noticeable rise in trading volumes before the announcement, raised suspicions of possible trading based on prior access to unpublished price-sensitive information (UPSI).

Sebi subsequently initiated a detailed examination of the trades. During this analysis, the regulator identified certain entities that had taken significant positions in IEX Put Option contracts trades that were notably inconsistent with their usual trading behaviour. These entities collectively earned unlawful gains amounting to Rs 173.14 crore.

Sebi noted that "humongous alleged ill-gotten gains have been made by these entities by executing trades with great precision and timing and at the cost of innocent investors who had no prior access about the impending fall in the price owing to the CERC order".

To gather concrete evidence, Sebi conducted a search and seizure operation between September 18 and September 20, 2025, across multiple locations linked to the concerned entities. The operation yielded substantial evidence suggesting that the suspects were receiving confidential information from senior CERC officials regarding internal developments, particularly those related to the market coupling order.

Accordingly, Sebi passed an interim order and directed the impounding of illegal gains and restrained the entities from dealing in securities until the amount is fully recovered.

"Furthermore, vide the order, the entities have been directed to impound Rs. 173.14 crore and have been restrained form dealing in securities till the amount is impounded," Sebi said.