CERC Officials Under SEBI Lens For IEX Stock Insider Trading

Officials from the Central Electricity Regulatory Commission (CERC) have now come under the scrutiny of the Securities and Exchange Board of India (SEBI) for alleged insider trading in shares of Indian Energy Exchange (IEX). In an ex parte order and investigation by the market regulator, SEBI has prima facie found selected officials from CERC allegedly involved in the act.

SEBI took a suo motu probe following the sharp fall in IEX stock prices after CERC brought forth talks of regulations on market coupling on July 23, 2025, post-market hours. The regulator also received a complaint alleging insider trading in the stock.

The stock market regulator appointed an investigating authority on September 12, 2025, to scrutinise the trading activities that took place between July 1 and August 14, 2025. The agency sought to determine whether the alleged activities violated provisions of the SEBI Act, 1992, and the SEBI (Prohibition of Insider Trading) Regulations, 2015.

SEBI Finds Reasonable Grounds 

“Since there were reasonable grounds to believe that Noticees traded in the scrip of IEX on the basis of prior knowledge of unpublished price sensitive information (‘UPSI’), an Investigating Authority was appointed vide order dated September 12, 2025, in order to ascertain whether the trading activities of Noticees were in violation of provisions of the Securities and Exchange Board of India Act, 1992 (hereinafter referred to as ‘SEBI Act’) and the Securities and Exchange Board of India (Prohibition of Insider Trading) Regulations, 2015,” SEBI said.

The market coupling regulations, authored by CERC, outline centralised matching of bids from multiple power exchanges to establish a uniform market-clearing price. This aims to replace the current system where each exchange determines prices independently and is intended to streamline price discovery across India’s short-term electricity markets. The move was seen as potentially negatively affecting the avenues of IEX, one of the largest power exchanges in India. The regulator noted significant movements in IEX’s share price and trading volume on July 24, a day after the CERC announcement, with the stock opening at ₹169.10 and closing at ₹132.32, a drop of 29.58%.

Impounding Bank Accounts 

In its interim order, SEBI directed that the bank accounts of the individuals involved be impounded, totaling ₹1,73,14,23,475.30. The regulator also barred all eight noticees from buying, selling, or dealing in securities, directly or indirectly, until further notice.

“Keeping in view the aforesaid discussions and after analysing all evidence available on record about the prima facie violations committed by Noticees, I hold that this is a fit case to exercise powers of passing an interim order, pending conclusion of investigation, so as to insulate the securities market and to protect the unlawful profits made from being siphoned off, which may go beyond the regulatory reach. Accordingly, I, in exercise of powers conferred upon me under sub-section (1) of section 11, sub-section (4) of section 11, sub-section (1) of section 11B read with section 19 of the SEBI Act, hereby, by way of the present interim ex-parte order…” the SEBI interim order said.