New Delhi: Share price of pharma major Sun Pharmaceutical Industries plunged 10% in the early trade on Monday as Sebi is mulling to reopen the case of irregularities by the company.
Markets regulator Sebi is likely to probe alleged lapses by some of its promoters and other entities in raising funds overseas, sources said.
The development comes after a whistleblower reportedly approached Sebi with a document alleging various irregularities by the company, its promoter Dilip Shanghvi and others, they added.
In August 2017, Sun Pharmaceutical, its managing director Dilip Shanghvi and nine other entities settled an insider trading probe on payment of Rs 18 lakh towards settlement charges.
Sources said Sebi is likely to reopen the case. The Securities and Exchange Board of India (Sebi) has powers to reopen cases of settlement related to insider trading on various grounds.
According to the sources, alleged irregularities by the company's promoters and others in raising funds through Foreign Currency Convertible Bonds (FCCBs) are also likely to be investigated by the watchdog.
Queries sent to Sun Pharma in this regard remained unanswered. About the whistleblower complaint, a company spokesperson said, "We have not been contacted by Sebi in this regard."
On Thursday, stock exchanges had sought clarification from Sun Pharma following a brokerage report that allegedly raised concerns about certain practices at the company.
In response, the company said the points raised pertain to historic events, some of which are dated as far back as 10-15 years.
"Certain points raised in the said note are incomplete and have been presented in a negative manner. "The supporting information to the points raised in the note has been sourced from public domain and hence this information/ data is already available in public," Sun Pharma had said in a filing on Thursday.
In August 2017, the regulator had not disclosed details of the case. However, it had appeared to be related to the acquisition of Ranbaxy by Sun Pharma from Japanese drugmaker Daiichi, as the settlement with the regulator has also been done by former Ranbaxy CEO Arun Sawhney, Daiichi's director Kazunori Hirokawa, its ex-Chairman Takashi Shoda and its former senior executive officer Tsutomu Une.
Shoda is said to have led Daiichi's acquisition of Ranbaxy in 2008, though the Japanese giant had to eventually sell its stake in the company to Sun Pharma in 2014.
Besides, the settlement was done by Ranbaxy's former secretary S K Patawari; Sun Pharma's directors Sudhir V Valia and Sailesh Desai; and its company secretary Sunil Ajmera.
Sebi had agreed to settle proposed adjudication proceedings in the case, pertaining to violation of the "internal code of conduct for prevention of insider trading" framed by the company, after it was approached by these 11 entities with a plea under the settlement regulations "without admitting or denying the findings of fact and conclusion of law"
(With PTI inputs)
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