Unsigned Order Leak During a Plant Visit

The draft release and the programme selection are likely material non-public information (MNPI). Materiality is assessed by whether a reasonable investor would regard the information as important in making an investment decision; a five-year, INR 4.2 billion order can be significant relative to a Tier-2 supplier's revenue and can also affect the OEM's cost and volume outlook. It is non-public because the OEM has not filed it with exchanges and the release is unsigned and unissued.

Immediate actions:

1. Stop - do not trade, recommend, or pass the information to the trading desk, sales, clients, or colleagues outside a need-to-know group.
2. Escalate to compliance the same day, describing the source, date, time, place, and exactly what was said and shown.
3. Do not publish a note that uses the order information, even in coded form such as 'our channel checks suggest upside'.
4. Segregate the information - keep the draft press release out of shared drives and do not circulate it.
5. Reassess the existing Hold note only on public information. The existing 'stable' view can be published if it is genuinely based on public data and does not hint at the order.

The key judgement is that the analyst cannot cure the problem by anonymising the source. Selective disclosure of MNPI to clients is prohibited, and the firm's proprietary position makes the risk of tipping especially serious.

The client call must be handled with a no-comment, no-hint response. You can say that you do not discuss unconfirmed market speculation and that your published view is the Hold note. You must not say 'watch this space', 'we are reviewing', or anything that signals the order. Even a refusal can become a signal if it is unusual, so keep the response routine and document the call.

The trading desk should not be informed of the order. If compliance places the OEM on a restricted list, the desk should be barred from trading or from increasing the proprietary position until the information is public or stale. The fact that the desk already holds a large position does not permit the firm to trade out of it on the basis of the tip; doing so would be insider dealing. Compliance should decide whether existing hedging or market-making obligations require a specific protocol.

A useful test is whether the firm would be comfortable explaining the client call and the desk's trades to the regulator. If the answer depends on the order information, the action is not permissible. The analyst's role is to escalate and follow the restricted-list instruction, not to manage the trading desk's P&L.

Document a contemporaneous record: the date and time of the plant visit, the identity and role of the operations head, the exact information received, the unsigned draft release, the client call, the compliance notification, the restricted-list action, and all drafts and communications about the note. Record who else knew and why. Keep the record in the compliance system, not in personal notes.

If the OEM confirms the order through an exchange filing tomorrow, the information becomes public. You may then analyse it and publish, but only after verifying the filing and checking whether the supplier or OEM has disclosed enough detail to support the revenue and margin impact. You should not simply reverse-engineer the MNPI into a report; the published analysis must be supportable from the filing, company disclosures, and independent work.

Even after publication, check the firm's no-dealing window and any restricted-list release before personal or desk trading. The earlier tip does not become usable retroactively, and any trading before the filing remains a compliance issue.