Chairperson's Disclosures Adequate, REIT Claims Inappropriate: SEBI On Hindenburg Report

SEBI on Sunday issued a point-by-point rebuttal to a fresh Hindenburg report that alleged potential conflict of interest by chairperson Madhabi Puri Buch and non-action in Adani Group's matters.

Firstly, India's markets regulator said all allegations made by Hindenburg Research, against the Adani Group, have been duly investigated.

Earlier in January, the SEBI had stated that the group has been given a clean chit in 22 out of 24 matters. Now, one more investigation was completed in March 2024, and one remaining investigation is close to completion.

"During the ongoing investigation in this matter, more than 100 summons, around 1,100 letters and emails have been issued to seek information. Further, more than 100 communications have been made seeking assistance from domestic/foreign regulators and external agencies. Also more than 300 documents containing around 12,000 pages have been examined," SEBI said.

It added that where investigations have been completed, enforcement proceedings initiated are ongoing and appropriate actions are being taken in accordance with the applicable securities laws.

SEBI also stated that investors should note that Hindenburg Research may have short positions in the securities covered in the report.

Secondly, SEBI said that claims that it made changes to its REIT regulations to favour a "diversified multinational financial conglomerate are inappropriate."

It said that all new regulations or amendments go through a robust consultation process and have to be approved by the SEBI Board.

It added that SEBI has at various times underscored the potential of REITs, SM REITs, InvITs and municipal bonds amongst other asset classes and therefore claiming that a certain asset class was favoured is incorrect.

Lastly, SEBI clarified that it has adequate internal mechanisms for addressing issues relating to conflict of interest, which include disclosure framework and provision for recusal.

"It is noted that relevant disclosures required in terms of holdings of securities and their transfers have been made by the Chairperson from time to time. Chairperson has also recused herself in matters involving potential conflicts of interest," it added.