Kalyan Jewellers Alleges Stock Manipulation, Urges SEBI to Halt F&O Trading
Kalyan Jewellers, one of India’s largest jewellery retailers, has formally asked the Securities and Exchange Board of India (SEBI) to investigate suspected stock price manipulation and temporarily suspend trading in the futures and options (F&O) segment for its shares. The request highlights concerns about unusual trading behaviour and misinformation that the company says drove its share price sharply lower.
The request is detailed in a letter the company sent to SEBI’s Integrated Surveillance Department in 2025, though it has only now become widely known. SEBI’s response has not yet been made public.
What Happened? Timeline of Events and Market Moves
F&O Listing and Early Trading Signals
Kalyan Jewellers’ stock was added to the F&O segment on 29 November 2024. Soon after, the company noticed abnormal price behaviour: futures contracts began trading at a discount to the actual stock price in the cash market. According to Kalyan Jewellers, this was not typical and suggested aggressive positioning by some traders.
Rumours and Volatility in Early January 2025
On 7 January 2025, the company says a number of unverified rumours began circulating in the market. These included claims denied by Kalyan Jewellers — about arrests of promoters and bribery involving fund managers. The company regards these reports as deliberate attempts to create panic among investors and trigger selling pressure.
In response to the rumours, Kalyan Jewellers denied all allegations and stated that the information was false and misleading.
Sharp Drop in Share Price
Between 6 January and 30 January 2025, the company’s share price fell from around ₹745 to ₹440.65, a fall of about 41%. Over the same period, its market value dropped significantly, with the company’s market capitalisation falling from approximately ₹76,795 crore to ₹45,450 crore.
Despite strong quarterly results in early February 2026, where net profits rose nearly 90%, and revenues were up 42%, the stock has remained volatile.
What Is Kalyan Jewellers Asking SEBI to Do?
In its letter to the market regulator, Kalyan Jewellers is urging SEBI to:
- Launch a full investigation into alleged manipulative trading activity.
- Temporarily suspend trading in F&O contracts for its shares until the probe is complete.
- Take steps to ensure investor protection and market integrity.
The company argues that unusual futures pricing and the timing of the rumours point to a coordinated effort to drive the stock down, possibly ahead of capturing gains from short positions.
SEBI has not yet publicly commented on the company’s letter or announced an investigation.
Why This Matters for Investors and Markets
The case raises broader issues about market transparency and fairness in India’s stock markets. Futures and options allow traders to bet on price movements, and unusual derivatives activity can sometimes foreshadow sharp moves in the cash market. Kalyan Jewellers’ request to halt F&O trading is rare and underscores the company’s concerns about potential market misuse.
Market participants and retail investors will be watching SEBI’s next steps closely. A decision to investigate or restrict F&O trading could have implications beyond a single stock, especially in how regulators monitor and manage derivative markets.
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