On 24th January 2022, Regulatory body for securities and commodity market, SEBI barred “14 entities for indulging in insider trading and ordered impounding ill-gotten gains of ₹2.94 crore” in the matter of Lux Industries Ltd., an Indian innerwear company headquartered in Kolkata, West Bengal, India.
The regulator’s surveillance alert system had noticed suspicious trading pattern in Lux Industries stock during an announcement made on the financial results of Q4 FY21 and the FY21.
As per the announcement, Sebi witnessed a substantial rise in its profits on QoQ and YoY basis. On further examination, Sebi found Udit Todi, company’s executive director, also involved in insider trading.
As a result, Lux Industries stock crashed 20% on 25th January 2022, rising concerns over the company’s corporate governance.