The report suggested that SEBI's inaction against offshore investors associated with the Adani Group might be influenced by Madhabi Buch’s own investments in similar funds.
Digital Desk: In a blog post released Saturday night, Hindenburg Research alleged that the Securities and Exchange Board of India (SEBI) was unwilling to act on its January 2023 report regarding the Adani Group due to supposed conflicts of interest involving SEBI Chairperson Madhabi Puri Buch and her husband, Dhaval Buch. Hindenburg claimed that both had investments in offshore funds linked to the Adani Group.
The Buchs have vehemently denied these accusations, labeling them as 'baseless' and accusing Hindenburg of attempting 'character assassination.' This latest statement from Hindenburg comes 18 months after the firm accused billionaire Gautam Adani of executing the 'largest con in corporate history,' a claim the Adani Group has firmly denied.
Hindenburg's blog post alleged that Madhabi Puri Buch and Dhaval Buch had invested in IPE Plus Fund 1, a Mauritius-registered fund, and Global Dynamic Opportunities Fund, a Bermuda-based fund. The post further claimed that Vinod Adani, Gautam Adani’s elder brother, invested in the Global Dynamic Opportunities Fund, which subsequently invested in IPE Plus Fund 1. Anil Ahuja, who was a director at Adani Enterprises, was cited as the founder and chief investment officer of IPE Plus Fund 1.
The report suggested that SEBI's inaction against offshore investors associated with the Adani Group might be influenced by Madhabi Buch’s own investments in similar funds. Hindenburg referenced documents from a whistleblower, including a fund declaration statement for IPE Plus Fund 1 and details about the Buchs' net worth, which was estimated at $10 million in 2015.
In response, Madhabi Puri Buch and Dhaval Buch issued a statement strongly denying the allegations. They asserted that the claims were false and stressed that all necessary disclosures had been made to SEBI over the years.
The blog also referenced an email purportedly sent by Dhaval Buch to Mauritius fund administrator Trident Trust on March 22, 2017, requesting exclusive control over their Global Dynamic Opportunities Fund accounts, and another email from February 25, 2018, in which Madhabi Buch allegedly used her personal Gmail account for fund-related transactions through her husband's name. Additionally, the report mentioned Dhaval Buch’s 2019 appointment as an advisor to Blackstone, suggesting that recent REIT legislation—which he was involved in—benefited Blackstone disproportionately.
Blackstone has not yet responded to requests for comment.
A Delhi-based executive from an alternative investment firm remarked that Hindenburg's latest report appears to be a follow-up on their previous work on Adani. The executive noted that the report seems to validate their earlier findings and implied that the regulator had not acted adequately. The potential impact of these revelations on India's appeal to foreign investors remains uncertain, though the executive suggested that the market might dismiss the issue.
Hindenburg’s January 2023 report had triggered a significant drop in Adani Group's stock prices, resulting in losses exceeding $100 billion. However, the group’s market capitalization has since rebounded to exceed its pre-Hindenburg levels.
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