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Adani-Hindenburg case: SEBI clears Gautam Adani & Co. of some allegations
There is no evidence that Adani Group used the so-called related party transactions to route funds into its listed units, SEBI says.
The Securities & Exchange Board of India has cleared the Adani Group and its billionaire founder Gautam Adani of some allegations of impropriety raised by the US short seller Hindenburg Research in early 2023.
There is no evidence that the Indian conglomerate used the so-called related party transactions to route funds into its listed units, SEBI said in two separate orders published on its website on Thursday. Ahmedabad, Gujarat-based Adani Group had repeatedly denied the allegations first made by Hindenburg Research in January 2023.
Gautam Adani reacted to the development in a tweet.
“SEBI has reaffirmed what we have always maintained, that the Hindenburg claims were baseless,” India's second-richest person posted on X, formerly Twitter, with a photo of the Indian flag. “Transparency and integrity have always defined Adani Group.”
“We deeply feel the pain of the investors who lost money because of this fraudulent and motivated report,” he went on to say. “Those who spread false narratives owe the nation an apology.”
“Our commitment to India's institutions, to India's people and to nation-building remains unwavering.”
The regulator’s investigation was related to allegations made by Hindenburg that Adicorp Enterprises Pvt. Ltd., Milestone Tradelinks Pvt. Ltd. and Rehvar Infrastructure Pvt. Ltd. were used as a conduit to route funds from various Adani Group companies to fund publicly listed Adani Power Ltd. and Adani Enterprises Ltd.
There was no violation of SEBI’s disclosure norms as transactions between Adicorp, Milestone Tradelinks and Rehvar Infrastructure with the group's firms did not meet the definition of a related party, SEBI board member Kamlesh C. Varshney said in the two orders.
The regulator’s orders still do not clear the conglomerate of other allegations raised by the short seller that in a scathing report in January 2023 alleged large-scale corporate fraud. It had triggered a stock rout that at one point eroded more than $150 billion in market capitalisation for the listed Adani entities and a court-directed regulatory probe.
Adani Group is also facing a probe by the federal prosecutors in the US in a $250-million bribery scheme and was indicted in November last year.
With inputs from Bloomberg and Reuters.
