New York based short seller, Hindenburg research is again in news but this time the market has not reacting the way it had reacting after the release of report in 2023. The research company tried to make a sensation during the weekend by posting "something big soon India” on twitter, but as the market opened, the session started with small fall and later traded positive as if the news was nothing worth giving attention to.
On August 10, Hindenburg released a follow up report of it 2023 allegations titled "Whistleblower Documents Reveal SEBI’s Chairperson Had Stake In Obscure Offshore Entities Used In Adani Money Siphoning Scandal." Earlier in 2023, the new york based company, tried to defame a corporate entity by posing allegation of fraud and brazen stock price manipulation but now, it has raised concerns about the neutrality of India's stock-market watchdog, SEBI. The report suggests a conflict of interest involving SEBI chairperson Madhabi Puri Buch and her investment links.
The report claimed that SEBI chief Madhabi Buch and her husband had made investments in offshore funds controlled by Gautam Adani's brother Vinod Adani. The fund considered here is IPE Plus Fund 1, in which Madhabi Buch and her husband had stakes in a multi-layered offshore fund structure with small assets. The funds used the funds to invest in Indian stocks and trade in equity shares, derivatives, and other financial instruments.
The Hindenburg report has raised questions about SEBI chairperson promoting real estate investment trusts (REITs) as a promising asset class without disclosing that her husband Dhaval Buch is now an adviser to Blackstone Inc., which has sponsored two of the four listed REITs in India.
The report has also questioned SEBI chairman ownership of stakes in a consulting company, Agora Partners, to show that she hasn't cut off ties to private businesses, something that being a regulator demands. Hindenburg also claims that Buch remained a 100% shareholder of Agora Partners Singapore until March 16th, 2022, per Singaporean records, owning it during her entire time as a SEBI Whole Time Member. She transferred her shares into her husband's name 2 weeks after her appointment as SEBI Chairperson. The Indian Agora Advisory, where Ms. Buch owned 99%, had revenues of INR1.98 crores in fiscal 2022.
Madhabi Buch and Adani has issued their response. Madhabi Buch called the allegations baseless and clarified that her financial records were an open book. Adani group called the report as malicious, mischievous and manipulative selections of publicly available information".
Adani group stocks fell as the session started but as the day pass by, most of the stocks recovered and become positive. So it’s a clear sign that market doesn’t want to give too much attention on such modified reports with absolutely biased facts and figures
