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Poonawalla Fincorp conducting independent probe into events leading to exit of MD: Adar Poonawalla

Surabhi Mumbai | Updated on September 20, 2021

Earlier, SEBI had barred MD Abhay Bhutada and seven others from the securities market for alleged insider trading in the shares of the company

Adar Poonawalla, Chairman, Poonawalla Fincorp, has said the company is carrying out an independent investigation into recent events leading to the exit of Managing Director Abhay Bhutada.

While saying that it continues to be business as usual at the company, the development has led Poonawalla, who is also CEO of Serum Institute of India, to take greater direct interest and involvement in the business of the NBFC.

“We are conducting an independent investigation ourselves also. But very soon, this entire matter will be cleared...in a positive way, and whoever has done anything wrong will face their justice,” he said.

“Abhay will also be clear of what he's done, because he actually hasn't done anything, as far as the lawyers and others (who have) given me the reports,” he said.

 

However, the first action in terms of corporate governance was that the person, irrespective of if he was guilty or not, has to step down until the inquiry is completed, Poonawalla stressed, adding that it has not been decided what will be done with the MD's position.

Vijay Deshwal, Group CEO, Poonawalla Fincorp, is running the operations of the company.

“Fortunately, even with the SEBI inquiry, there's nothing on the company. It’s going to be business as usual; we’re going to be giving loans and collecting loans. This is not really going to affect the business and the fundamentals of the targets,” he further said.

The Securities and Exchange Board of India has barred Bhutada and seven other people from the securities market for alleged insider trading in the shares of the company, which was earlier known as Magma Fincorp. SEBI has also ordered impounding of wrongful gains worth over ₹13 crore, according to an interim order.

 

Following this, Bhutada stepped down from the post on September 16 and denied all allegations.

Highlighting key areas for the NBFC, Poonawalla said there are three or four target areas, including building the insurance business, lowering the cost of funds and improving profitability and new products, including personal loans, professional loans and consumer finance.

Published on September 20, 2021

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