Jane Street: Income tax department conducting surveys at Nuvama Wealth

The income tax department on Thursday conducted survey operations at the offices of Jane Street and Nuvama, its on-ground trading partner in India. They were in relation to alleged stock market manipulation involving Jane Street.

In an exchange filing, Nuvama confirmed that the income tax department was conducting a survey under Section 133A of the Income Tax Act, 1961, at the company’s registered office. Nuvama said it was extending full co-operation with the authorities and sharing requisite information. The survey was yet to be concluded at the time of writing this copy. Nuvama said it would make requisite disclosures, if any, to the stock exchanges under SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

The company continues to operate business as usual, Nuvama said.

Jane Street is a large client for Nuvama’s clearing business, Bernstein said in a July 23 note. Low activity from this client account during parts of FY26 could hurt Nuvama's interim growth, it had warned.

The IT department's move comes days after SEBI permitted global proprietary trading firm Jane Street's entities to resume trading in the Indian equity market. This followed the firm’s compliance with SEBI’s directive to deposit $567 million or approximately Rs 4,843.50 crore) into designated escrow accounts.  

SEBI in an update on July 21, however, asked Jane Street entities to cease and desist from  directly or indirectly engaging in any fraudulent, manipulative or unfair trade practice or undertaking any activity, either directly or indirectly, that may be in breach of extant regulations, including by dealing in securities using any of the patterns identified or alluded to in the interim order. 

Following the latest news, shares of Nuvama Wealth Management Ltd slipped 1.90 per cent, trading at Rs 7,270.50 on the BSE. 

Bernstein last week said Nuvama Wealth is its top pick, leveraging four growth engines: wealth management for high/ultra-high net worth clients, clearing services, and asset management.

"The clearing business is less understood but stands out for its high growth, 40 per cent-plus ROE, with exposure to rising derivative volumes, and to the growth of alternative fund managers in India. While near-term headwinds are expected due to ongoing regulatory actions impacting one large client, we remain positive on medium-term growth, expecting 25 per cent profit growth and 29 per cent RoE beyond a softer FY26," it said.

Jane Street, which operated in both the cash and derivatives segments as a Foreign Portfolio Investor (FPI) and trading member, had earlier faced regulatory action. SEBI had barred some of its entities from participating in the Indian market amid allegations of manipulation in the Bank Nifty index — a benchmark that includes major Indian banking stocks. Initial findings suggested a complex and potentially unlawful trading strategy, allegedly facilitated by Jane Street’s advanced trading systems.

SEBI had further directed stock exchanges to closely monitor all future trades and positions held by Jane Street Group entities to ensure they do not engage in any form of market manipulation. This surveillance was to continue until the regulator completes its investigation and any resulting proceedings.