D2C unicorn Mamaearth disclosed on Thursday that a senior executive of the company violated insider trading norms.
In a submission to the BSE, Honasa Consumer, the parent company of Mamaearth, stated that the vice-president of sales at the startup, Shuchi Garg, engaged in share trading without obtaining prior approval from the company secretary or compliance officer.
The breaches were related to the Code of Conduct outlined in the Securities and Exchange Board of India (Prohibition of Insider Trading) Regulations, 2015.
“…We would like to inform you that one of the Designated Person (Employee) of the Company has traded into the equity shares of the Company without obtaining preclearance of the Company Secretary and Compliance Officer of the Company,” Mamamearth said.
Meanwhile, the unicorn has issued a cautionary letter to the employee in question, instructing her to ‘abstain’ from such actions in the future. Mamaearth also indicated that the issue would be presented during the company’s audit committee meeting to formulate a ‘comprehensive action plan’.
According to the regulatory filing, the executive’s transgressions occurred across two distinct transactions on separate days. On December 12, Garg divested 2,000 shares of Honasa Consumer at INR 420 each, amounting to a total value of INR 8.4 lakh.
On the subsequent instance, which occurred on December 27, she once more conducted the sale of 1,500 shares of the company at a share price of INR 457.16, leading to a combined value of INR 6.85 lakh. Both transactions, amounting to a total of INR 15.2 lakhs, were carried out without explicit pre-clearance from the company secretary.
Mamaearth entered the stock market last month, achieving a premium listing of 2% (INR 330) on the NSE. Conversely, its debut on the BSE was at a flat INR 324. The stock has experienced a significant surge of over 42% on the BSE since its listing, primarily driven by favourable Q2 FY24 financial results and a growing positive sentiment among investors towards innovative tech stocks.
Continue Exploring: Mamaearth marks its entry on NSE with nearly 2% premium debut
Last week, brokerage firm JM Financial initiated a ‘BUY’ call on Honasa Consumer, citing a better outlook and strong financial performance so far.
Mamaearth shares concluded 0.22% down at INR 460.35 on the BSE on Thursday, December 28.
