It is asking investors to be cautious and calm before basing any conclusion on any such irrelevant reports like Hindenburg Research.
In that regard, investors shall keep in mind that Hindenburg Research may be having some short position in securities so projected by them in their report, said SEBI.
Most of the allegations brought out by Hindenburg Research were already under probe by SEBI. On the Supreme Court's order dated 3 January 2024, SEBI had completed 22 out of 24 investigations up to that date. Since then, as of March 2024, one more investigation has been finalized and only one remaining investigation is nearing completion.
In the process of these investigations, more than 100 summons have been issued by SEBI and about 1,100 letters and e-mails to elicit information. Besides, it has also sent out over 100 letters seeking assistance from domestic and foreign regulators, or external agencies. More than 300 documents running into about 12,000 pages have been examined by SEBI.
It also flayed SEBI for the show-cause notice of 27 June 2024 to Hindenburg Research in its report. The SEBI said that legal procedures had been followed while issuing this notice alleging breaches by Hindenburg Research under the securities laws.
It has also noticed that Hindenburg Research has made the show-cause notice available on its website along with the reasons leading to its issuance; As the proceedings are continuing and are being dealt with in accordance with settled practices and principles of natural justice, no intervention at this stage is called for.
The Hindenburg report even said that the SEBI (REIT) Regulations 2014 and further amendments raised questions on whether they were tailored to suit a large multinational financial conglomerate. SEBI termed such insinuations " inappropriate" and added that the regulations and circulars pertaining to REITs were not aimed at securing any private interest of any single company.
It referred to the strong internal mechanisms it has for conflict of interest, linked to a disclosure framework and provisions for recusal. SEBI, over time, developed the most effective regulatory framework in conformity with international best practice, and that worked well toward protection of the investors.
SEBI reiterated its commitment to maintaining the integrity of India's capital markets and to supporting their orderly growth and development.
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