Exchange Data Reveals Ketan Parekh's Front-Running of Tiger Global Trades

Stock exchange data has confirmed that a group of operators engaged in front-running trades involving the US-based investment firm Tiger Global’s shares in PB Fintech. The Securities and Exchange Board of India (SEBI), in its January 2 order, referred to Tiger Global as the "Big Client" and named veteran market operator Ketan Parekh, Singapore-based trader Rohit Salgaocar, and other associated entities as participants in the scheme.

Reports indicate that Tiger Global, along with one of its funds, sold shares of PB Fintech on November 11, 2022. SEBI’s order mentioned PB Fintech, the parent company of Policy Bazaar, but did not specify the exact name of the fund involved, only referring to it as the "Big Client." The investigation revealed that the group, including Parekh, Salgaocar, and others, was not only involved in front-running these trades but also actively bought shares as Tiger Global executed its sell orders.

Front-running is an illegal practice in which trades are placed based on confidential, non-public information about large upcoming transactions that may impact stock prices. This allows individuals to profit by trading ahead of the major orders, manipulating the market for personal gain.

According to SEBI’s 188-page order, two funds associated with the "Big Client" sold 52.5 lakh shares of PB Fintech on November 11, 2022. Entities such as GRD Securities Limited (FR1), Salasar Stock Broking Limited (FR2), and Anirudh Damani (FR3) matched trades with the "Big Client" for 20.61 lakh shares. Data from the Bombay Stock Exchange (BSE) showed that Tiger Global Eight Holdings and Internet Fund III Pte Ltd, both associated with Tiger Global Management, collectively sold 1.23 crore shares of PB Fintech in 2022. Tiger Global Eight Holdings sold 76.13 lakh shares, while Internet Fund III Pte Ltd sold 51.6 lakh shares. On November 11, 2022, Tiger Global also sold 32.84 lakh shares on the National Stock Exchange (NSE) at a price of ₹388.34 per share.

The SEBI report includes screenshots of group chats revealing that Parekh was providing detailed trading instructions related to PB Fintech shares. It was found that Salgaocar received information from Tiger Global’s trader regarding the planned sale of PB Fintech shares and passed it on to Parekh, who then directed Salasar Stock Broking (FR2) to execute trades. Before the market opened, Salgaocar and the trader from the "Big Client" discussed the sale plans. Between 9:00 a.m. and 9:58 a.m., Parekh gave multiple instructions through a WhatsApp group named "Jack-Saro" regarding the sale of shares at various price points.

By 11:16 a.m. IST, FR2 confirmed the execution of a buy order for 5,80,869 shares on the BSE, with 5,79,001 of those trades matching the "Big Client’s" sell orders. The SEBI investigation underscores the flow of insider information from Tiger Global’s trader to Salgaocar, then to Parekh, resulting in coordinated trades that took advantage of non-public information and manipulated the market.