Indian shares are expected to open flat on Monday as the Securities and Exchange Board of India (SEBI) urges investors to remain calm following allegations made by US-based short-seller Hindenburg Research against SEBI Chairperson Madhabi Puri Buch [d54dae1c]. The Gift Nifty was trading at 24,362.5, indicating that the benchmark Nifty 50 will open near its Friday's close of 24,367.5. Hindenburg Research alleged that Buch previously held investments in offshore funds used by the Adani Group, a claim that Buch denied, stating that all investments had been duly disclosed. SEBI released a separate statement asking investors to exercise due diligence and remain calm in response to the report. The Association of Mutual Funds in India also reassured investors that India's financial system is secure and transparent. Analysts believe that these allegations are unlikely to have a significant impact on corporate earnings or macro fundamentals of Indian markets, but may cause minor perception-driven fluctuations [d54dae1c].
However, SEBI's credibility is now under scrutiny following the allegations made by Hindenburg Research. The US-based research firm has accused SEBI of being reluctant to investigate charges related to the use of offshore funds linked to the Adani Group, citing a conflict of interest involving SEBI Chairperson Madhabi Puri Buch [16d29224]. Hindenburg Research claims that Buch and her husband have a personal stake in the fund in question, raising concerns about impartiality. Buch and her husband have denied any wrongdoing, stating that their investment in the fund was made before Buch joined SEBI. They also clarified that Buch's consulting firms became dormant upon her appointment with SEBI. These allegations have raised questions about SEBI's credibility and adherence to its code of conduct guidelines [16d29224].
SEBI's response to the allegations has been to urge investors to remain calm and exercise due diligence. The regulator has emphasized the importance of transparency and has reassured investors that India's financial system is secure. The Association of Mutual Funds in India has also echoed these sentiments, stating that the country's financial system is transparent and robust. Analysts believe that while the allegations may cause minor perception-driven fluctuations in the market, they are unlikely to have a significant impact on corporate earnings or macro fundamentals [d54dae1c].
