SEBI probes alleged irregularities in Piramal's acquisition of DHFL loans: Report

Media reports show that the Securities and Exchange Board of India (SEBI) is looking into whistleblower allegations against Piramal Capital & Housing Finance Ltd (PCHFL) pertaining to loans that it has taken over from the now-defunct DHFL. Loans were transferred at a huge discount to entities allegedly linked to promoters of the Piramal Group. The whistleblower alleges that this resulted in the loss of funds to public shareholders of a listed entity, Piramal Enterprises Limited (PEL). This is based on a report by Business World.

In 2021, PCHFL — a wholly owned subsidiary of Piramal Enterprises — bought DHFL for Rs34,250 crore using cash and issuance of debt instruments. PCHFL is also alleged to have assigned loans, at deep discounts, to Encore Natural Polymers and APRN Enterprises. They allegedly paid Rs 650 crore more than what they received for these loans, therefore harming the shareholders of PEL by paying spoiler prices to DHFL's original borrowers.

According to the whistleblower letter, both Encore and APRN are said to be indirectly connected to the promoters of Piramal Group, where the merchant shares links with members of the staff from both Piramal and Encore Natural Polymers. According to reports, these transactions helped Encore and APRN earn quick profits.

The whistleblower questions where these funds come from which may have been made by the Sahana Group — associated with Sudhakar Shetty, who is a borrower defaulted on dues — and that it appears to have generated money after selling real estate assets under stress. The CBI is already probing alleged financial irregularities within DHFL, including the diversion of over Rs 14,000 crore.

WION is yet to receive a response from Piramal Housing and the SEBI ON queries for comments on media reports.