Following severe accusations made against SEBI Chairperson Madhabi Puri Buch and her husband, Dhaval Buch, by US-based short seller Hindenburg, Adani Group stocks fell sharply in today’s trading. The market, however, did not respond angrily to these claims because the losses were restricted to the modest reductions in the Adani Group equities.
Hindenburg’s Accusations
Hindenburg claimed that the Adani Group was running the largest con in corporate history. The investigation uncovered a network of offshore shell companies, primarily with headquarters in Mauritius, that were utilized for stock manipulation and covert related-party activities. Hindenburg accuses SEBI for failing to implement regulatory oversight by not taking public action against the Adani Group in spite of strong evidence.
Without contesting the facts in Hindenburg’s first analysis, SEBI sent Hindenburg a show cause notice, arguing that Hindenburg had not provided enough information regarding its short position. Hindenburg’s report was deemed reckless by SEBI due to its citation of a prohibited broker who contended that SEBI was aware of and involved in schemes like as the Adani controversy.
Hindenburg’s Deep Analysis
Hindenburg’s study delves deeper into the relationships between the offshore money and the Buchs. It draws attention to the fact that the Buchs’ investment vehicle, the IPE Plus Fund, was a component of a complex offshore fund structure overseen by India Infoline (now 360 One), a company connected to the Wirecard fraud. By the end of December 2017, the fund’s assets under management amounted to just $38.43 million, indicating its secretive character.
This is in stark contrast to how the market reacted to Hindenburg’s initial accusations against the Adani Group in January 2023, which caused the market value of the conglomerate’s 10 listed firms to drop by USD 150 billion at its lowest point. In a swift response, the Adani Group and SEBI rejected the allegations as unfounded. Furthermore, investors have assiduously reviewed Hindenburg’s most recent analysis, which was made public over the weekend.
SEBI Chairperson Madhabi Puri Buch And Her Husband’s Statement
SEBI chairperson Buch and her spouse Dhaval said their finances are transparent and refuted the accusations as unfounded. Dhaval Buch, her spouse, works as a senior advisor for Blackstone. The Adani Group described the most recent accusations as dishonest and predicated on selective manipulation of public data. The business declared that it had no business dealings with the wife or chairwoman of the SEBI.
In reaction to the latest accusations, SEBI Chairperson Madhabi Puri Buch and her husband Dhaval Buch released a thorough statement. They clarified that they had invested in the IPE Plus Fund 1 long before Madhabi was appointed to SEBI, which Hindenburg had connected to purported Adani stock manipulation. Mr. Anil Ahuja, the Chief Investment Officer and Dhaval’s longtime buddy from school and IIT Delhi, had an impact on their choice to invest. Ahuja’s long career, which included positions at 3i Group plc, Citibank, and JP Morgan, played a big part in their choice to invest. When Ahuja left his position as CIO in 2018, the Buchs withdrew their stake in the fund.
Indian REITs Association’s Statement
The Indian REITs Association, whose founding members include Brookfield India Real Estate Trust, Embassy Office Parks REIT, Mindspace Business Parks REIT, and Nexus Select Trust, stated that notable international institutional investors have expressed a great deal of interest in and participation in the sector due to its growth. The involvement of these investors boosts the legitimacy and trustworthiness of India’s financial system while also giving them a dependable and open way to participate in the developing real estate market in the nation.
