According to court documents, two foreign portfolio investors (FPIs) with headquarters in Mauritius who were connected to the Indian Adani Group in the January 2023 Hindenburg report have petitioned the Securities Appellate Tribunal (SAT) in order to obtain immediate relief from adhering to Sebi’s new foreign investor norms. On August 19, documents indicated that both parties had filed the case and paid the SAT fee.
The petition is scheduled for a hearing next week, and the funds claimed that their investors had been unfairly disadvantaged by Sebi’s orders requiring them to adhere to particular restrictions that did not apply to other FPIs, according to persons with direct knowledge of the case.
LTS Investment Funds and Lotus Global Investment have requested that SAT grant their request for an expedited ruling from Sebi on their exemption application. Additionally, they have requested protection from Sebi’s directive, which requires funds that do not comply with the new FPI concentration norms to unwind their portfolios by September 9. They have requested that SAT instruct Sebi to provide them until March 2025 to comply with these standards.
While Lotus claimed that the size of its global investment portfolio was $900 million, LTS claimed to have a portfolio worth approximately $4 billion. It was impossible to determine the extent of their India portfolio, though. They both violate a particular requirement that FPIs limit the amount of money they invest in India to no more than 50%.
On August 23 that up to 43 billion applications had been submitted to Sebi and that a number of FPIs were having problems because of the FPI concentration regulations. As per the regulations, FPIs that violate the concentration norms must sell their excess assets by September 9th.
