Kaynes Technology India Ltd witnessed a sharp decline in its stock price on March 12, 2025. The stock fell as much as 9.6 per cent to an intraday low of Rs 3,893.85 on the Bombay Stock Exchange (BSE) before recovering slightly. The drop follows a show-cause notice issued by the Securities and Exchange Board of India (SEBI) to the company's Managing Director, Ramesh Kunhikannan.
SEBI’s Concern Over Structured Digital Database Compliance
SEBI's notice, issued on March 10, 2025, raises concerns over the maintenance of the Structured Digital Database (SDD) during the financial year ending March 31, 2023. This alleged non-compliance is linked to the Prohibition of Insider Trading (PIT) Regulations, 2015, which are designed to prevent the misuse of sensitive financial data and unfair trading practices.
Company’s Response to the Allegations
Kaynes Technology confirmed the receipt of SEBI’s notice through an exchange filing. The company acknowledged that the notice pertains to a potential lapse in maintaining SDD records for the period ending March 31, 2023.
The management has stated that they are reviewing the notice and will take all necessary legal and procedural steps to provide a formal response to SEBI. Additionally, the company has reiterated its commitment to fully cooperating with the regulator and ensuring compliance with all legal requirements.
A Stock That Soared 470 per cent Now Faces Market Volatility
Over the past five years, Kaynes Technology has delivered an impressive 470 per cent return to its investors. However, following SEBI’s notice, investor sentiment has taken a hit, resulting in the stock’s downward movement.
Performance Trends: Sharp Drop in 2025
Despite recording a 42.07 per cent gain over the past year, Kaynes Technology's stock has seen significant volatility in 2025:
Year-to-date (YTD) drop: 43.33 per cent
Six-month performance: 7.60 per cent decline
Three-month decline: 33.76 per cent
One-month recovery: 5.29 per cent increase
The latest regulatory challenge has intensified selling pressure, adding to the stock’s already volatile performance in recent months.
Investor Sentiment and Future Outlook
SEBI’s investigation and the potential consequences of the notice remain a key concern for investors. While Kaynes Technology has pledged to comply with regulatory requirements, the market reaction highlights growing uncertainty surrounding the company’s governance and compliance framework.
The coming weeks will be crucial as investors await further clarification from the company and SEBI’s response to the situation. Whether Kaynes Technology can restore investor confidence and stabilize its stock remains to be seen.
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