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The capital market regulator Securities and Exchange Board of India (Sebi) has launched a massive search operation in connection with WhatsApp earnings leak case. Confirming the development, a regulatory official told Business Standard that about 34 people have been identified and are being searched. These people are company officials, brokers and entities who allegedly gained out of the earnings information which was made public in advance. Nearly 100 Sebi officials and policemen had been deployed for the search operation, which is being done in coordination with the Mumbai police. The search operation will continue for two days, said official cited above. Last month, Sebi had initiated a probe against dozen odd companies including—Dr Reddy’s, Cipla, Axis Bank, HDFC Bank, Tata Steel, Wipro and Bajaj Finance. The other five were Mahindra Holidays and Resorts, Crompton Greaves Consumer Electricals, IT services providers Mindtree and Mastek, and India Glycols, a petrochemicals company. According to the sources, around five companies, whose price-sensitive information had leaked on social media, are under investigation.
However, BS could not ascertain the five companies under the current Sebi search operation lens. These five companies have been identified after analysing and examining their trade data of the last 12 months. Further, it had matched the leaked earnings with the actual results of the September quarters to detect a possible breach of Prohibition of Insider Trading (PIT) norms.