SEBI Flags Possible ₹5,667-Crore Fraud At BSE-Listed Dhenu Buildcon
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SEBI has flagged a suspected fund-routing arrangement involving Dhenu Buildcon, alleging that ₹1,000 crore of loans may have been created through circular transactions. The regulator has also restrained six entities from selling Dhenu shares worth around ₹5,667 crore.
The Securities and Exchange Board of India (SEBI) has raised concerns over a suspected fund-routing arrangement involving Dhenu Buildcon Infra Ltd.
In an interim order dated 19 August, the regulator said money may have been moved repeatedly between a group of companies to make it appear that Dhenu had received ₹1,000 crore in fresh loans. Around ₹840 crore of the purported borrowing was later converted into shares.
SEBI has called the arrangement a “closed, self-sustaining financial network”. However, the order is not a final finding of fraud. The regulator said its observations are prima facie and that the matter needs further investigation.
SEBI Tracks ₹1,000 Crore Through Multiple Companies
According to the order, the activity started months before Dhenu Buildcon reported receiving the loans.
SEBI examined WhatsApp messages that referred to Dhenu, bank accounts and a proposed preferential allotment. Later conversations discussed loan agreements, KYC documents, stamp papers and bank verification.
Dhenu raised its borrowing limit to ₹1,000 crore on 21 December 2024. Between 24 and 31 December, the company received ₹1,000 crore through 46 transactions. The money was said to have come from seven lenders.
SEBI traced the transactions backwards and found 28 different fund-routing patterns. In one instance, around ₹25 crore moved through several companies before reaching Dhenu. The regulator said the same pool of money was then circulated through other entities and returned to Dhenu as loans from different companies.
The banking records raised another concern. Dhenu's highest bank balance during the period was only around ₹25.81 crore, despite the company supposedly receiving ₹1,000 crore.
At the same time, around ₹996.1 crore moved out of Dhenu to five entities, including Genesis Developers & Holdings, Hillridge Investments, Abhijit Trading and Intellectual Builders.
Doubts Over Lenders And Preferential Allotment
SEBI said several links between the companies went beyond the movement of money. It found common directors, authorised signatories, addresses and bank branches. Communications between the entities also formed part of the regulator's findings.
Site inspections raised further questions. SEBI said there was limited activity at Dhenu's registered office and no senior management was present. Some lenders allegedly had little or no visible business activity at their registered addresses.
The financial strength of some lenders also appeared out of proportion to the amounts they were said to have provided.
SEBI cited Tiaan as one example. The company reported revenue of only a few lakh rupees in the relevant years but was shown as having provided ₹160 crore in loans.
The matter later moved to a preferential allotment. In July 2025, Dhenu proposed converting around ₹840 crore of the purported loans into equity.
On 27 December 2025, it allotted 5,91,54,92,940 shares to six entities at ₹1.42 per share. The allotment gave these entities 99.70% of Dhenu's diluted equity.
SEBI Freezes Shares Worth ₹5,667 Crore
SEBI's concern is that the loan transactions and share allotment formed part of the same arrangement.
Its prima facie view is that the alleged circular movement of funds created an artificial liability for Dhenu. That liability was then converted into shares, giving the entities involved effective control of the listed company.
The shares started trading in February 2026. Their lock-in period ended on 15 August. On 17 and 18 August, the allottees began selling shares. SEBI identified sales of 17,444 shares worth around ₹1.34 lakh.
The regulator stepped in on 19 August and barred the six allottees from selling their Dhenu shares. It said the shares held by them were worth around ₹5,667 crore based on the relevant volume-weighted average price (VWAP).
SEBI clarified that ₹5,667 crore is not the amount already earned or siphoned off. It represents the potential value of the shareholding and the possible wrongful gain if the shares were sold at prevailing market prices.
The regulator also barred Surendra Jain and Virendra Jain from dealing in securities or associating with the securities market. Dhenu was restricted from carrying out certain corporate actions.
SEBI said further investigation is needed into the lenders, intermediary companies, auditors, professionals, preferential allotment and trading activity.
The regulator has also not established the ultimate source of the initial ₹25 crore or the final amount of any wrongful gain.
For now, SEBI's central allegation is that a network of companies may have circulated funds to make ₹1,000 crore of borrowing appear genuine, followed by the conversion of around ₹840 crore into equity. The investigation will determine whether those transactions breached securities laws and who, if anyone, was responsible.
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This article is for informational purposes only and should not be considered investment advice from Kotak Neo. For compliance T&C and disclaimers, Visit www.kotakneo.com/disclaimer
Vishwa has spent 10+ years across fintech and FMCG doing what most people miss, connecting the dots, catching trends before they trend, and finding the angle nobody else thought to ask about.
At Kotak Neo, she drives content strategy for neoshorts, Kotak News Desk, and Investing Guide, turning market noise into something worth reading.
When she's not decoding markets, she trades charts for canvases, chasing art, painting, and architecture across cities she's yet to explore.
