The Parliamentary Standing Committee on Commerce on suspicions of insider trading in Dunlop India (DIL) shares, will seek clarifications from Sebi about its trading on the BSE. Dunlop’s two units at Sahaganj and Ambattur has no production and the company has not been earning any revenue since 2013. But its share price movement in the past one year has been showing an upward trend, based on which the parliamentary committee has suspected insider trading in the Ruia Group’s 213 companies.
Chandan Mitra, chairman of the commerce committee said that the parliamentary panel would ask Sebi to dig into Dunlop’s share trading and ensure that there was nothing wrong going on.
While, the management contended that it was the brand value of Dunlop, which led to gains in the stock, the committee opined that it was unnatural for a company’s share to gain when it has no revenue at all.
DIL did not earn any revenue in FY 13 and FY 14 and its FY12 revenue slipped to R20.01 crore from R173.2 crore in FY 11. However share prices reached its peak of R30 during September last year.
The committee also raised questions about whether the Ruia Group was utilising Dunlop to fund other ventures of the company.