Hindenburg’s Claims on Buch’s Investment Disputed

Securities and Exchange Board of India (Sebi) Chairperson Madhabi Puri Buch and her husband Dhaval Buch have addressed recent allegations made by the US short-seller Hindenburg Research. According to the Buchs, the investment in question, linked to the Adani Group, was made two years before Madhabi’s appointment as Sebi chief.

The Buchs’ statement clarified that their investment in the IPE Plus Fund 1, managed by 360 ONE Asset and Wealth Management (formerly IIFL Wealth Management), occurred in 2015. At that time, both were private citizens residing in Singapore, well before Madhabi joined Sebi as a Whole Time Member in 2017.

Dhaval Buch, a close associate of the fund’s Chief Investment Officer Anil Ahuja, highlighted that the investment decision was based on Ahuja’s extensive experience in banking and investments. The investment was redeemed in 2018 after Ahuja left the fund, further distancing it from any Adani-related activities.

Hindenburg’s report alleged that the IPE Plus Fund, a small offshore fund, was used for dubious transactions involving the Adani Group. It accused Vinod Adani, brother of industrialist Gautam Adani, of using this fund structure to funnel money into Indian markets. The report also claimed that Buch’s husband requested control over their investments just before her Sebi appointment, raising suspicions of avoiding scrutiny.

Contrary to these claims, the Buchs and 360 ONE Asset Management stated that the fund never invested in Adani Group companies, either directly or indirectly. They emphasized that their total holdings in the fund were minimal, constituting less than 1.5% of its inflows.

Additionally, the Buchs refuted allegations that Dhaval’s prior association with Blackstone had any impact on Sebi’s decisions regarding Real Estate Investment Trusts (REITs). They stressed that Dhaval’s expertise in supply chain management was the basis for his role at Blackstone, and his connection with the firm was not linked to any regulatory bias.

The Hindenburg report’s allegations come 18 months after its previous claims about the Adani Group, which led to significant stock market turmoil. Following this, the Supreme Court directed Sebi to conduct a thorough investigation and establish a panel to review potential regulatory lapses. Despite this, no adverse reports were issued against Adani, and the Supreme Court deemed no further probes necessary beyond Sebi’s ongoing investigation.

In response to the new allegations, opposition parties have called for immediate measures to address perceived conflicts of interest in Sebi’s investigation and have demanded a Joint Parliamentary Committee inquiry into the matter.

Aakhir Tak Editor-in-Chief

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