MUMBAI, MONDAY, AUGUST 12, 2024 FOLLOW US ON TWITTER & FACEBOOK. APP AVAILABLE ON APP STORE & PLAYSTORE WWW.FINANCIALEXPRESS.COM READ TO LEAD VOL LXIV NO. 191, 18 PAGES, `12.00 P U B L I S H E D F R O M : A H M E D A B A D , B E N G A L U R U , C H A N D I G A R H , C H E N N A I , H Y D E R A B A D , K O C H I , K O L K ATA , L U C K N O W, M U M B A I , N E W D E L H I , P U N E AFTER BOMBSHELL, HINDENBURG FACES THE MUSIC Buch defends herself in a 15-point rebuttal A NEW STRATEGY TO INVEST ACROSS MARKET CAPS THE TWO CONSULTING FIRMS SET UP BY MADHABI DURING HER STAY IN SINGAPORE BECAME IMMEDIATELY DORMANTAFTER HER APPOINTMENT AS SEBI CHIEF Sebi backs its chief, says made relevant disclosures VIVEK KUMAR M Mumbai, August 11 INDIA’S CAPITAL MARKETS regulator on Sunday defended its chairperson Madhabi Puri Buch saying she had recused herself from matters involving potential conflicts of interest and made relevant disclosures. In a statement issued in the wake of allegations byUS short-sellerHindenburg against the SecuritiesandExchange Board of India (Sebi) chairperson, the regulator Continued on Page 15 GE P CA MID 25% 50% Continued on Page 15 Adani calls report a‘red herring’ THE ADANI GROUP has dismissed the latest allegations made by the Hindenburg,callingitsreporta“redherring.” In a statement to the stock exchanges on Sunday,anAdani Group spokesperson said the allegations byHindenburg are malicious, mischievous,and manipulative selections of publicly available information to arrive at pre-determined conclusions for personal profiteering with wanton disregard for facts and the law. “We completely reject these allegations against the AMID ALLEGATIONS MADE by Hindenburg Research about Blackstone Real Estate InvestmentTrusts (REITs) benefiting from the employment of Dhaval Buch as Senior Advisor, sources close to the private equity firm said the conclusion is “erroneous”. Buch,who is the husband of Securities and Exchange Board of India chairperson Madhavi Puri Buch, is employed with Blackstone Private Equity. He exclusively advises private equity companies 25% Dhaval had no role in Blackstone REITs AKSHATA GORDE Mumbai, August 11 Adani Groupwhich are a recyclingofdiscreditedclaimsthat have been thoroughlyinvestigated, proven to be baseless, and already dismissed by the Supreme Court in January 2024,” the spokesperson said.The spokesperson reiterated that the group’s overseas holding structure is fully transparent, with all relevant details disclosed regularly in numerous public documents.Furthermore,Anil Ahuja was a nominee director of the 3i investment fund in Adani Power from 2007 to 2008 and later a director of Adani Enterprises until 2017. Continued on Page 15 FE BUREAU Mumbai, August 11 across Asia on procurement and supply chain related topics,which is his area of expertise, and is not involved with real estate, REITs, capital markets or interface with any regulator on any topic while at Blackstone. While the firm did not want to comment on the issue, the sources said in any case, Buch’s appointment in 2019 pre-dates the Sebi chairperson’s appointment and has been in the public domain. So, drawing any corelation is absurd, the sources said. Continued on Page 15 INSIDE Markets are likely to see a knee-jerk reaction at best PAGE 4 CA Hindenburg: Making a business out of disasters in corporates PAGE 4 Opposition parties seek probe, BJP calls it a conspiracy PAGE 4 Digital antitrust law may be for Big Tech only MANU KAUSHIK New Delhi, August 11 THE GOVERNMENTIS likelyto substantially raise the thresholds forfirms and enterprises to be brought under the ambit of the proposed digital competition lawfrom the levels mentionedinthedraftBill.Theproposedseparate ex-ante regulations for the digital market could be limited to the likes of Amazon, Meta, Apple, Google, Facebook and Microsoft.Start-ups and other relativelysmallerfirmswouldbekept outside its ambit. The move, according to sources, is aimed at ensuring that the proposed regulations do not stifle innovation and dilute consumer benefits. The review of the thresholds specified in the draft Digital Competition Bill (DCB) is also in acknowledgment of the fact that otherthan the European Union (EU) and theUK,a few jurisdictionshaveventuredinto introducing separate anti-trust law for the digital sector. Several experts reckon that the EU law is an overreach as the regularex-post anti-trust regulationsmightsufficetodealwiththedigital sector as well. The EU may have a reason to have a separatelawforex-anteregulationofcompetition in the digital sector, given the dominance of SAFEGUARD FOR STARTUPS ■ The current draft Bill mentions quantitative and qualitative thresholds for firms to be identified as systemically significant digital enterprises (SSDEs) OPINION: Beyond suspicion PAGE 8 UP sticks to hybrid waiver, rejects pleas of Tata, M&M FE BUREAUS New Delhi/Mumbai, August 11 US-based firms in the global marketplace. However,experts believe India would do well to not expand the ex-ante controls to the smaller firms, given that benefits of digitilisation are still unfolding in the country and are expected to spurstartups and the innovation ecosystem. UTTAR PRADESH CHIEF secretary Manoj Kumar Singh on Sunday categoricallyturned down the demand by automakers such as Tata Motors, Mahindra and Mahindra, and HyundaiMotorIndiaforrollingback theregistrationtaxwaiveronhybrid vehicles,whichthestategovernment had announced last month. At a meeting attended by all the manufacturers, including Maruti Suzuki India,Hyundai,Tata Motors, Toyota Kirloskar, Honda Car India, and M&M, Singh said electric vehicles and strong hybrids have a penetrationof1.5%eachinthestate.The remaining 97% share is of internal combustion engine (ICE) vehicles. Singh said the state’s aim is to raise the combined market share of EVs and hybrids and the registration tax waiverforhybrids,onthelinesofEVs, was to achieve this objective. Continued on Page 15 Continued on Page 15 ■ Quantitative threshold takes into account a company's financial strength and business reach ■ Qualitative criteria consider parameters such as enterprise resources andvolume ofaggregated data SMA SMA MA ALL ALL ALL CA CA CA CA A A A A CLAIMS THAT REGULATIONS...RELATED TO REITs WERE TO FAVOUR ONE LARGE MULTINATIONAL FINANCIAL CONGLOMERATE ARE INAPPROPRIATE said that “relevant disclosures required in terms of holdings of securities and their transfers have been made bythe chairperson from time to time”. It also refuted the allegations made by Hindenburg that Sebi had not taken any action against the Adani Group, saying these have been duly investigated with 22 of 24 matters completed. “Subsequently,one more investigation was completed in March 2024, and one remaining investigation is close to completion,”it said.The statement added that where investigations have been completed, enforcement proceedings are ongoingandappropriate actionsare being taken in accordance with the applicable securities laws. On the show-cause notice of June 27, 2024 to Hindenburg Researchallegingviolationsof securities laws,the regulator said it had been issued following due process of law. P P P P P P SECURITIES AND EXCHANGE Board of India (Sebi) chairperson Madhabi Puri Buch and her husband Dhaval Buch on Sunday sought to explain the investment in the offshore entities referred to byHindenburg Research in its report on Saturday, saying it was made in 2015, almost two years before she joined Sebi as a whole-time member. Buch became a whole-time member in April 2017 and took over as chairperson in March 2022. In a 15-point rebuttal that followed Saturday night’s short dismissal of the charges made by the US-based shortseller,the couple noted the investment in the IPE-Plus Fund was driven by personal connections with the fund manager and was redeemed in 2018. The Buchs asserted that at no point in time did the fund invest in any bond, equity, or derivative of any Adani Group company.Both she and her husband were living as private citizens in Singapore at the time of the investment. The entity managing the offshore fund, 360 WAM, also issued a statement to say the Buchs had no investments in Adani Group shares, either directly or indirectly. “Throughout the fund’s tenure, IPE-Plus Fund 1 made zero investments in any shares of the Adani Group either directly or indirectly through any fund,” it said, adding Madhabi Buch and Dhaval Buch’s holdings in the fund were less than 1.5% of the total inflow into the fund. The US-based firm,the Buchs said,had chosen to “attempt character assassination” in response to Sebi’s enforcement actionandashow-causenoticeissuedtoit. AT NO POINT IN TIME DID THE (IPE-PLUS) FUND INVEST IN ANY BOND, EQUITY, OR DERIVATIVE OFAN ADANI GROUP COMPANY LA R AKSHATA GORDE Mumbai, August 11 MADHABI PURI BUCH & DHAVAL BUCH P P P P P Short-seller’s charges termed malicious and motivated rusted Introducing HDFC NIFTY500 MULTICAP 50:25:25 INDEX FUND NFO PERIOD: 6 - 20th August, 2024 th HDFC Nifty500 Multicap 50:25:25 Index Fund, gives investors allocation to 500 stocks of the Nifty 500, but with weights to large, mid and smallcaps set to 50%, 25% and 25% respectively. WHY INVEST? Participate in the India growth story with exposure to 500 stocks across a variety of sectors SCAN TO KNOW MORE ‘All-in-one’ exposure to large, mid and smallcaps through a single product Convenient and tax-efficient way to maintain large-mid-small cap allocation of 50%, 25% and 25% respectively~ ~ Weights to each segment are reset every quarter. 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