Not probing any Adani company since 2016: SEBI tells SC
The Securities and Exchange Board of India (SEBI) told the Supreme Court on Monday that claims about it investigating the Adani Group since 2016 were "baseless," adding that no listed company of the Adani Group is among the 51 Indian companies being probed. It also asserted any premature conclusion regarding its probe into the Hindenburg claims would be legally untenable and won't serve justice.
Why does this story matter?
In January, United States-based short-seller and investment research firm Hindenburg Research accused the Adani Group of running the biggest corporate fraud and risking people's investments. Following this, Adani Group's shares tanked by $150B within weeks. The ruling Bharatiya Janata Party (BJP) has been accused of being in cohorts with the conglomerate, while the party also called the report an attack on India's economic growth.
SEBI approached foreign regulators regarding Adani Group first in 2020
The SEBI told the SC Adani Group's transactions, which Hindenburg highlighted for allegedly violating Indian laws, were highly complex as they have many sub-transactions across various jurisdictions. It added it had approached 11 overseas regulators requesting data to check if the conglomerate violated any norm related to its publicly available shares. The national market regulator made the first such request in October 2020.
SEBI seeks 6 months for probe, SC gives 3 months
In February, the Centre informed the apex court that the SEBI was looking into Hindenburg's allegations. In March, the SC gave it two months to complete the probe. However, last month the SEBI sought six months to finish the investigation, which the SC reduced to three months. Separately, the SEBI earlier said the price fluctuations of Adani Group didn't have a significant market impact.
SEBI probing global depository receipts of 51 companies
The SEBI is probing the global depository receipts by 51 Indian firms. Banks issue global depository receipts, which represent the shares in a foreign company that are being traded in a domestic stock exchange. The SC directed the SEBI in March to probe if the Adani Group had violated the rules regarding maintaining minimum public shareholding, disclosing transactions, and manipulating stocks.
