The Securities and Exchange Board of India (SEBI) reportedly requested that a group of global funds that had invested in the Adani Group respond to claims of market manipulation and irregular disclosures.
Indian Regulator Looks at Adani Stock Manipulation
According to a Bloomberg report, SEBI acted against a pair of foreign portfolio investment firms. The first allegedly engaged in shorting shares of Gautam Adani’s companies after it became aware of the publication of a short-seller report from Hindenburg Research, based in the US. When this report came to light in January 2023, it decreased the Adani Group’s value by $100bn.
The second cluster on the receiving end of the SEBI notices are foreign funds with ties to the founders of the Adani Group. It came under scrutiny in June 2021 as they invested most of their capital in Adani assets.
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SEBI is investigating the transgression of investment rules. Reportedly, the Adani Group has denied any association with these funds. No comments were forthcoming from the Adani Group or SEBI.
The financial watchdog will review the responses from the investment funds before issuing sanctions or taking other actions. Based on Bloomberg information, these are the final steps in the Hindenburg investigation, as India’s highest court ruled that there would be no further investigations into this matter.
SEBI said the funds neglected to disclose information about the top echelon gaining from these investment actions. They further violated the investment limits of the different Adani segments.
Seemingly, some investors, such as Cresta Fund, Albula Investment Fund, and Vespera Fund, aim to settle the matter by paying fines without admitting guilt.
