April 8 (Reuters) - Shares of Australia's DroneShield tumbled nearly 20% on Wednesday after it announced the resignation of CEO Oleg Vornik and Chairman Peter James, months after they offloaded shares worth millions.

The drone technology firm slid as much as 19.8% to its weakest level in six weeks and marked its biggest intraday percentage loss since November 19.

After more than a decade in the role, Vornik will be immediately replaced by current Chief Product Officer Angus Bean, while Hamish McLennan was appointed independent non-executive chairman.

In November, top executives including Vornik and James sold their shares for an aggregate A$70 million ($49.46 million) over six days, triggering a multi-week sell-off worsened by the sudden exit of its U.S. CEO and an order disclosure error.

The board in December launched a governance review, introducing a minimum shareholding policy and extending the trading blackout period for directors and senior executives.

The stock's volatility is amplified by a lofty valuation that sits at about roughly 900 times the company's earnings, said David Tuckwell, chief investment officer at ETF Shares.

"The share price collapse (today) reflects a serious loss of trust. Investors are questioning whether these resignations signal that something worse is coming around the pike," he added.

The selloff comes despite DroneShield's revenue jumping 87% in the first quarter, extending its momentum from 2025.

The company was a market favourite last year with an annual gain of over 300% despite the slump in the last few months of 2025, supported by a steady contract pipeline, strong earnings growth and its inclusion in the S&P/ASX 200 index.

($1 = 1.4152 Australian dollars)

(Reporting by Jasmeen Ara Shaikh and Nichiket Sunil in Bengaluru; Editing by Sumana Nandy and Sonia Cheema)

By Nichiket Sunil and Jasmeen Ara Islam Shaikh