Even seasoned business journalists in Hyderabad cannot remember the last time they had a freewheeling chat with the heads of Aurobindo Pharma, a listed company with a turnover of Rs24,855 crore and a market cap of Rs64,500 crore. Last month, however, a handful of journalists were invited for a meeting with the company’s founder, P.V. Ram Prasad Reddy. His son P. Sarath Chandra Reddy is an accused-turned-approver in the Delhi liquor scam case. Aurobindo Pharma wanted to erase the blot of Sarath Chandra’s arrest by highlighting the company’s achievements.
The Reddys have always maintained a low profile, but they enjoy close ties with powerful lobbies, in Andhra Pradesh, Telangana and outside. But not many people knew that Sarath Chandra, who also heads the Andhra Cricket Association, was actively involved in the liquor business till the details of the Delhi scam came out. According to charge-sheets filed by the Enforcement Directorate, Sarath Chandra was the kingpin of the South Group, which orchestrated the Delhi liquor scam. The group operated five liquor zones in Delhi like a cartel through multiple firms. They did so allegedly by paying bribes amounting to Rs100 crore to key players associated with the Aam Aadmi Party government. Arrested in November 2022, Sarath Chandra got bail on health grounds in May 2023. A few weeks later, he turned approver in the case.
This was not Sarath Chandra’s first brush with the law. In 2012, he was named in a charge-sheet filed by the CBI in a disproportionate assets case against Y.S. Jagan Mohan Reddy. The case involved a land sale agreement benefitting Trident Life Sciences, a company run by Sarath Chandra. This time around, it was another company, Trident Chemphar Limited, that landed him in trouble. According to the ED, Trident Chemphar and other proxy entities operated by Sarath Chandra were used to operate the liquor zones by joining hands with other businessmen, lobbyists and politicians in which money laundering was a significant element. Sarath Chandra’s name also figures in the electoral bonds controversy. Aurobindo Pharma and its associated firms donated around Rs60 crore to the BJP in the last two years.
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Another Reddy family is also said to be involved in the Delhi liquor scam. Ongole MP Magunta Sreenivasulu Reddy and his son Raghava Magunta were arrested by the ED last year, but they turned approvers recently. According to the ED, Raghava had a key role in formulating the now-retracted Delhi excise policy. Based on his statement, the ED said that Delhi Chief Minister Arvind Kejriwal had asked former Telangana chief minister K. Chandrashekar Rao’s daughter K. Kavitha to reach out to him to explore opportunities in Delhi’s liquor business. Kavitha is seen as the link between the two Reddy families as she was said to be in touch with Raghava and Sarath Chandra and was instrumental in bringing them together.
The Magunta family, which owns Balaji Distilleries, has been in the liquor business for almost seven decades. Sreenivasulu had initially denied any connection to any business activity in Delhi, saying that Raghava took care of the liquor business. Sreenivasulu, who was an MP from the YSR Congress Party, has switched sides and joined the Telugu Desam Party. The TDP has given him the ticket from Ongole constituency, a deal that critics allege was brokered by the BJP. Opposition parties allege a quid pro quo between Sreenivasulu and the BJP and blame the saffron party for letting him contest the polls.