In what would appear to be a violation of insider trading norms, ARL Trading and Alexure Securities, companies in which former chief financial officer of Monnet Group Ajay Bhat was a shareholder, are believed to have bought shares of Monnet Ispat without reporting the purchases to the stock exchanges.
According to investments reported by the two firms in 2011 in balance sheets, the companies bought a total of 5.15 lakh shares worth Rs 20.83 crore, information from the ministry of corporate affairs website showed. A scrutiny of the disclosures on the exchanges reveals no record of the transactions.
While shares of Monnet Ispat worth Rs 14.56 crore were purchased by ARL Trading, shares worth Rs 6.27 crore were bought by Alexure Securities.
However, in a telephone conversation Bhat denied the purchases but was unwilling to discuss documents accessed by FE in this regard. Alexure Securities had among its directors or shareholders Suvigya Jain Singhi, wife of Santosh Singhi, CFO, Amtek Auto and Kheer Bhawani Trading.The shareholders of ARL Trading include Aakriti Structures, Zara Trading, Alessa Homes and Alexure Securities.
Among the shareholders in Kheer Bhawani are Lovely Bhat, wife of Ajay Bhat, and ALA Financial Advisors. In turn, Ajay Bhat and ARL Trading own a stake in ALA Financial Advisors. Sandeep Jajodia, CMD, Monnet Ispat, told FE he would like to “strongly confirm that Monnet Ispat or myself in no way have knowledge of the above alleged transactions and no funds or support in any way has been provided by us for any of his personal dealings”.
“We have never met or seen Santosh Singhi and neither does Monnet Ispat have any business relationship currently or ever in the past with Amtek Group. We confirm that we have never met any representatives including the promoters of Amtek Group, ever in our lives,” he said.
Meanwhile, an Amtek spokesperson replied to an email saying that none of the companies stated in the email “has or, in the past, had any direct or indirect connection with Amtek or any of its Group Companies”.
The papers also suggest that an NGO — Leap of Faith — has two main sponsors, Amtek Auto and Monnet Group.
This NGO is registered in New Delhi.
To this, Jajodia said that Bhat said Singhi was very apologetic on behalf of his daughter (founder of the NGO), who had created this website for the purpose of her college applications. “We confirm that not a single rupee of donation has ever been made by Monnet Ispat to Leap Of Faith,” he added.
To the same question, an Amtek spokesperson wrote that neither Amtek nor any of its group companies has “never made any donation, of whatsoever nature, to the NGO — Leap of Faith — mentioned in you mail”.
According to Securities and Exchange Board of India regulations, “Any person who is or has during the six months prior to the concerned act been associated with a company, directly or indirectly” that allows such person, access to unpublished price-sensitive information or is reasonably expected to allow such access is termed as a
‘connected person’ and immediate relative of the connected person will be recognised as being connected as well.
The regulator goes on to say that any connected person or anyone in possession of unpublished price-sensitive information is an “insider”.