Nafeez Sarafat and the Capital Market Influence Game

For more than a decade, Nafeez Sarafat shaped key financial decisions — from mutual fund management to high-stakes IPOs — leaving an indelible mark on Bangladesh’s stock market.

No name resonates more strongly in Bangladesh’s financial market than Chowdhury Nafeez Sarafat — a man whose power extended across mutual funds, IPOs, and corporate empires. His journey mirrors the evolution of Race Asset Management, the firm through which he built his empire and reputation.

Race began operations with the EBL First Mutual Fund and grew rapidly to manage thirteen mutual funds. Ten of these were closed-end funds designed for a decade-long tenure. Yet, under Sarafat’s influence, they were extended by another ten years, a move that would later define his controversial legacy.

At the time, BSEC Chairman M Khairul Hossain confirmed that he had rejected the idea initially but reversed the decision after pressure from Finance Minister Abul Maal Abdul Muhith.

By 2024, Race managed assets worth Tk3,200 crore at cost and Tk2,350 crore at market valuation. Critics argue these funds were often used for Sarafat’s financial maneuvers, which intertwined with political and corporate interests.

Sarafat’s ties to Salman F Rahman and Nazrul Islam Majumder were key early relationships. When Rahman encouraged investment in Beximco, Sarafat followed — but later sold off shares independently, allegedly angering Rahman. He subsequently formed new alliances with Finance Minister AHM Mustafa Kamal and Finance Secretary Abdur Rouf Talukder, leveraging them to push the Best Holdings Ltd. IPO.

The company’s direct listing was eventually approved under Professor Shibli Rubayat-Ul-Islam’s BSEC. Insiders allege placement shares went to influential individuals, including relatives of former IGP Benazir Ahmed, to consolidate Sarafat’s power.

Sarafat’s political networking also played a role in the Coppertech Industries IPO, where he was said to have distributed placement shares to key figures to ensure its approval. Despite controversies over false financial data, Coppertech was listed after extensive lobbying.

Meanwhile, MTB Capital CEO Khairul Bashar Abu Taher Mohammad, the IPO manager, later assumed a senior position at the Dhaka Stock Exchange — allegedly with Sarafat’s backing.

Despite recurring allegations, no decisive action was ever taken against Race Asset Management. Even when investigations were proposed, they stalled. Regulatory oversight remained lenient, and mutual fund extensions continued.

Beyond capital markets, Sarafat diversified his interests through Strategic Finance Ltd (SFL), controlling stakes in Unique Meghnaghat Power Plant and earning Tk100 crore in profit when Qatar’s Nebras Power purchased a minority share.

Under new management, Race Asset Management has since pursued reform — focusing on transparency, compliance, and investor protection. Industry analysts view these steps as vital in restoring trust.

Still, the narrative of Nafeez Sarafat is one of influence and audacity — a story that reveals both the opportunities and vulnerabilities of Bangladesh’s evolving capital market.