A business with interests in more than one sector of the economy can be run as a single company with multiple divisions as a conglomerate or with several independently run companies as a conglomerate. In India, conglomerates are large and diverse family-owned businesses. The firms affiliated to them hold large market shares in their respective sectors. On average, they tend to be larger than the unaffiliated firms. Through the act of setting up independent firms, shadow leveraging takes place through seemingly arm's length relationships. Considerable effort is made to obfuscate the nature of the association between firms to obviate the accounting requirements for disclosure of consolidated accounts. This paper tries to establish that firms affiliated to a conglomerate are far more leveraged than their unaffiliated counterparts. Regulators and market participants are focused narrowly on their specific jurisdictions. Since the leverage is moved to unlisted and unregulated market segments, the systemic risk arising from them remains largely unexplored. Regulators need to be aware of this systemic risk and alter regulations to introduce greater disclosures from such groups.