Hindenburg-SEBI Row: Attack On India With No Substance, Says Madhusudan Kela
Investors need not worry specifically about impact as there is no substance in the allegations, the market veteran has said.
The latest report by Hindenburg Research which alleges that the head of the country's market regulator, Securities and Exchange Board of India, has a conflict of interest, is an attack on the country and intends to malign Madhabi Puri Buch, the person behind the growth in the capital market, according to market veteran Madhusudan Kela.
The allegations and subsequent responses make it clear that there is a larger purpose to the report, the founder of MK Ventures told NDTV Profit in an exclusive interview. "It is maligning the image of someone who has so immensely contributed to the Indian capital market under various roles."
In a report late Saturday, the US-based short seller, led by Nathan Anderson, accused the Securities and Exchange Board of India's Chairperson, Madhabi Puri Buch, of conflict of interest, while investigating allegations made against the Adani Group.
The report alleged that Buch and her husband, Dhaval Buch, had investments in a complex fund that was used to siphon and buy back shares of the Adani group companies. This was denied strongly by the SEBI chairperson and the Adani Group the day after the report was published.
This allegation is not about an individual and corporate house but an attack on the country, the market veteran with over 33 years of experience said. "Who are they (Hindenburg Research) to say you can't trust the system? I think we are one of the finest and best regulators in the world. Both RBI and SEBI over the years have done a fantastic job."
The short-seller was issued a show cause notice and rather than replying, it is coming after the regulator itself, he noted. It is crystal clear that there is nothing in the report that has any substance, Kela said.
Kela's Message To Investors
Market investors need not worry specifically about this impact as there is no substance in these allegations, he said. "It will not destabilise the markets and or will it cause any significant correction."
The message to the investors is clear, and that is to believe in the country and growth prospects, Kela said. "Use any kind of opportunities to buy into the India story. The last three years have seen strong returns, important to moderate return expectations going forward."
"Stick to your portfolio allocation and invest into India with medium to long term perspective," he said.
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