The market regulator, Securities and Exchange Board of India (SEBI) has issued a notice to fintech firm One97 Communications. One97 Communications is the parent company of Paytm. The notice concerns employee stock options (ESOPs) granted to Vijay Shekhar Sharma, its mnaging director and CEO.
This development was revealed in the company’s filing on Monday for the March 2024 quarter.
Paytm clarified that this notice is not a new issue and that it has been in ongoing discussions with SEBI to address the regulator’s concerns. Furthermore, it assured that it is in regular communication with SEBI to provide the necessary representations and comply with any regulatory requirements.
The scrutiny from SEBI is connected to ESOPs that were issued to Sharma during the financial year 2022. According to Paytm’s financial year 2024 annual results, the company had allocated 2.1 crore ESOPs to Sharma during that period. SEBI had previously issued a show-cause notice to Paytm, questioning the allocation of these stock options to Sharma.
Paytm’s response indicates that it is actively engaged with the regulator to resolve the matter, and the company is working to ensure that all regulatory obligations are met.
Recently, the company bolstered its Employee Stock Option Plan (ESOP) by allotting 1,10,357 equity shares to eligible employees. The allotment has been approved by Paytm’s Nomination and Remuneration Committee on 5 August, 2024, under its Employee Stock Option Scheme 2019.
