Paytm Shares Slide as SEBI Serves Notice to Vijay Shekhar Sharma Over 2023 Disclosure Timing
Summarized by AI; it may make mistakes. Check important info
Summarized by AI; it may make mistakes. Check important info
Shares of One 97 Communications, Paytm's parent entity, dropped to an intraday low of ₹1,598.60 on the BSE on Thursday following market regulator SEBI issuing show-cause notices to the company's top management.
The Securities and Exchange Board of India targets Chief Executive Vijay Shekhar Sharma and Chief Financial Officer Madhur Deora over the timing of a critical corporate disclosure made in December 2023.
Regulatory Heat Over Disclosure Delays
The probe focuses on an announcement made on December 6, 2023, where Paytm revealed plans to scale down its sub-₹50,000 personal loan business. That decision followed a broader regulatory crackdown by the Reserve Bank of India, which raised capital requirements for unsecured consumer lending roughly three weeks prior to Paytm's public statement.
SEBI's notice examines whether the information constituted Unpublished Price Sensitive Information and whether the management delayed its public classification. Paytm's stock had already slipped nearly 12% in the eight trading sessions preceding the December 6 declaration, before crashing 20% on the immediate trading day following the announcement.
14-Day Deadline to Respond
The company confirmed in an exchange filing that both executives have been given 14 days to submit their responses to the regulator.
Show-cause notices serve as formal inquiries under Indian securities regulations. If SEBI finds the management's response unsatisfactory, the executive leadership could face administrative penalties, financial fines, or market access restrictions.
