Mystery 'Big Client' in SEBI's Ketan Parekh probe points to Tiger Global

Exchange data reviewed by YourStory shows Tiger Global was the only major institutional investor to sell large blocks of PB Fintech shares on a day when India's market regulator says traders illegally profited from advance knowledge of a big sale.

The Securities and Exchange Board of India's (SEBI) recent order describes a "Big Client"—a major foreign institutional investor—whose November 11, 2022 trades were allegedly front-run by former stockbroker Ketan Parekh's network. Stock exchange records show Tiger Global's funds sold approximately 12.7 million PB Fintech shares that day, making it the largest institutional seller. There is no suggestion that Tiger Global was aware of or connected to any wrongdoing.

SEBI alleges that Rohit Salgaocar, a Singapore-based consultant, tipped off Parekh—who was previously barred from Indian markets following his role in a 2001 market manipulation scheme—about the upcoming large share sale. Traders who know about such large sales in advance can profit by buying shares first and selling them once the price drops after the big sale.

According to the regulator's order, Salgaocar leaked specific details: the planned sale of 1.75 million shares at 382 rupees. Parekh allegedly used encrypted WhatsApp messages to direct his associates to acquire 500,000 shares through brokers, including Salasar Stock Broking and GRD Securities, before 10:02 am that day.

The scheme escalated as Parekh's group anticipated more sell orders at 384.50 rupees. Trading volume of PB Fintech (PolicyBazaar) shares surged to 7.93 million shares—nearly 60 times the daily average.

Two Tiger Global funds executed large sales that day: Internet Fund III sold 5.16 million shares, while Tiger Global Eight Holdings offloaded 7.61 million shares. The only other significant seller was Mumbai-based Priyasha Meven Finance, but its numbers were smaller.

However, it is important to note that the SEBI order does not explicitly mention Tiger Global in any capacity.

Salgaocar's position was crucial to the alleged scheme. His firm, Strait Crossing Pte Ltd, had referral agreements with major Indian brokerages including Motilal Oswal Financial Services and Nuvama Wealth Management. These arrangements let him direct institutional trades and earn a share of brokerage fees.

The Big Client entrusted intermediaries like Salgaocar to handle its trades in the Indian market. However, Salgaocar allegedly leaked sensitive, non-public information to Parekh.

Parekh could give instructions to brokers and receive real-time updates on trade execution. SEBI alleges he passed this information to Parekh, who then used it to profit from predictable price movements caused by the large trades.