The report alleges that Blackstone has significant stakes in REITs in India and that the sector received a fillip during Madhabi Puri Buch’s time at SEBI’s helm.
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The latest bomb dropped by Hindenburg Research dwells a lot on Dhaval Buch, husband of SEBI Chairperson Madhabi Puri Buch, and his appointment to “Blackstone, a global private equity firm and large investor in India, as a “Senior Advisor” in July 2019, per his Linkedin”. The Hindenburg report says that Dhaval was chief procurement officer at Unilever and had “never worked for a fund, in real estate or at a capital markets firm”.
The report alleges that Blackstone has significant stakes in REITs in India and that the sector received a fillip during Madhabi’s time at SEBI’s helm.
What are REITs?
Real Estate Investment Trusts, commonly known as REITs, are companies that own, operate, or finance income-generating real estate. These companies provide a unique opportunity for investors—whether individuals or institutions—to earn dividends from real estate investments without the need to purchase or manage properties directly.
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REITs are structured to make real estate investments accessible to all. They manage portfolios that can include commercial buildings, health care facilities, data centres, and infrastructure projects. An investor can essentially buy into the REIT, similar to purchasing stock in any other business. In return, investors receive a portion of the income generated by the properties in the form of dividends.
Extract from the Hindenburg report alleging links between Dhaval Buch, SEBI activity and Blackstone’s stake in REITs
“Blackstone has been one of the largest investors and sponsors of REITs, a nascent asset class in india
“During Dhaval Buch’s time as senior advisor, while his wife was a SEBI official, Blackstone sponsored Mindspace and Nexus Select Trust, India’s second and fourth REIT to receive SEBI approval to publicly IPO.
“Blackstone has been one of the largest investors and sponsors of REITs, a nascent asset class in India.
India’s first ever REIT, Embassy, obtained SEBI approval and IPO’ed on April 1st, 2019, sponsored by Blackstone, just 3 months before Dhaval Buch reported joining Blackstone in July 2019.
“13 months later, in August 2020, Mindspace REIT, backed by Blackstone, became India’s second REIT to IPO, after SEBI approval.
“Blackstone now sponsors Nexus Select Trust, described as India’s largest retail platform of assets, by ICICI Research, which listed in May 2023, and became India’s fourth publicly traded REIT. Blackstone has multiple other interests across retail estate.
“During Dhaval Buch’s time as advisor to Blackstone, SEBI has proposed, approved and facilitated major REIT regulations changes. These include 7 consultation papers, 3 consolidated updates, 2 new regulatory frameworks and nomination rights for units, specifically benefiting private equity firms like Blackstone.”
