Shares of leading basmati rice producer KRBL are sharply lower by over 9 percent on September 15 after a company filing revealed that an independent director has resigned from the board citing concerns around governance standards.
Anil Kumar Chaudhary had resigned on September 08, 2025 with immediate effect, and the company informed the exchanges about the development the next day, with the resignation letter citing the reason shared in a filing on September 14.
The director cited 'certain issues' that have persisted despite efforts to address them, which have posed 'professional and ethical dilemmas'.
"...I am no longer able to meaningfully contribute to the Board's functioning in the manner envisioned under the regulatory framework for independent directors," Anil Kumar Chaudhary said in his resignation letter.
He also cited some concerns around governance of the board, which have likely unsettled investors in the shares of the company, leading the sharp selloff. "I believe that effective governance and truly independent oversight are essential ingredients for safeguarding stakeholder interests and I find the prevailing dynamics of the Board to be inconsistent with these principles," he added.
One of the grave charges mentioned in the resignation letter by Chaudhary has alleged that dissent on the board of KRBL is 'suppressed or sidelined'.
"In such an operating environment where dissent is suppressed or sidelined, remaining on the Board would compromise both my professional ethics and obligations as defined under Indian corporate governance codes," Chaudhary said.
The director cited 'certain issues' that have persisted despite efforts to address them, which have posed 'professional and ethical dilemmas'.
Citing specifics, Anil Kumar Chaudhary said there have been 'inconsistencies' in the recording of minutes of board and committee meetings, and there have been 'instances of information being withheld', which he said has impacted informed decision-making.
Some concerns were also cited relating to the financials of the company, wherein 'unjust write-off' of certain export receivables were carried out without adequate deliberation. The outgoing director also raised concerns around the use of CSR funds.
There has also been 'arbitrary distribution' of Variable Pay and Annual Increments to persons holding office or profit, the director said.
Citing another instance, Anil Kumar Chaudhary said, 'significant changes' to the object clause was undertaken 'without comprehensive discussion', and there has been 'undue interference' by invitees during board meetings.
There has been no comment so far by the company on the accusations by the outgoing director against the company.
Despite the sharp selloff, shares of KRBL have been higher by over 32 percent so far this year. During the June quarter, KRBL's export revenue came in at Rs 489 crore, reflecting a 98 percent YoY growth. with total revenue came at Rs 1,584 crore on strong momentum in the export business. The company reported an EBITDA of Rs 225 crore and a net profit of Rs 151 crore.
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