The Adani Group, already under scrutiny from a previous report by Hindenburg Research, experienced another significant selloff on Monday after the short-seller accused the head of India's market regulator, Madhabi Puri Buch, of having ties to offshore funds linked to the conglomerate. Despite initial sharp declines, the group managed to recover some losses, closing the day with a $2.43 billion, or 1%, reduction in market value.
The ongoing clash between Hindenburg Research and the Adani Group, which began 18 months ago, has once again put the Indian conglomerate in the spotlight. The U.S.-based short-seller initially alleged that Adani improperly used tax havens, accusations the group has consistently denied. In its latest move, Hindenburg cited whistleblower documents claiming a conflict of interest for Buch, who has chaired the Securities and Exchange Board of India (SEBI) since 2022, due to her previous investments.
Buch and SEBI both dismissed the allegations, with Buch referring to them as "character assassination" following enforcement actions taken by the regulator against Hindenburg for violating Indian rules. SEBI has stated that the allegations against the Adani Group have been thoroughly investigated.
On the stock market, Adani's flagship firm, Adani Enterprises, closed 1.1% lower, with other companies in the group such as Adani Ports, Adani Total Gas, and Adani Power seeing declines between 0.6% and 4.2%. Only Adani Green bucked the trend, closing 1% higher.
Industry experts have suggested that the market reaction to these latest allegations may be temporary. Sunny Agrawal, head of fundamental equity research at SBICAPS Securities, noted, "This is a temporary, knee-jerk reaction. Things will get back to normalcy."
Despite the pressure, the Adani Group has seen some investor confidence restored through investments from Abu Dhabi-based International Holding and U.S. investment firm GQG Partners, which helped narrow its losses from $150 billion to about $32.5 billion since the first Hindenburg report in January 2023.
Looking ahead, Adani Enterprises is planning to launch a $1 billion share sale by mid-September, following a previously shelved $2.5 billion offer. Additionally, Adani Energy recently raised $1 billion from U.S. investors and sovereign wealth funds.
The political implications of these allegations are also gaining traction. While ruling Bharatiya Janata Party lawmaker Ravi Shankar Prasad dismissed the allegations as baseless, opposition leader Rahul Gandhi expressed concerns on X, formerly Twitter, stating, "The integrity of SEBI, the securities regulator entrusted with safeguarding the wealth of small retail investors, has been gravely compromised by the allegations against its chairperson."
(Source:www.invesitng.com)
The ongoing clash between Hindenburg Research and the Adani Group, which began 18 months ago, has once again put the Indian conglomerate in the spotlight. The U.S.-based short-seller initially alleged that Adani improperly used tax havens, accusations the group has consistently denied. In its latest move, Hindenburg cited whistleblower documents claiming a conflict of interest for Buch, who has chaired the Securities and Exchange Board of India (SEBI) since 2022, due to her previous investments.
Buch and SEBI both dismissed the allegations, with Buch referring to them as "character assassination" following enforcement actions taken by the regulator against Hindenburg for violating Indian rules. SEBI has stated that the allegations against the Adani Group have been thoroughly investigated.
On the stock market, Adani's flagship firm, Adani Enterprises, closed 1.1% lower, with other companies in the group such as Adani Ports, Adani Total Gas, and Adani Power seeing declines between 0.6% and 4.2%. Only Adani Green bucked the trend, closing 1% higher.
Industry experts have suggested that the market reaction to these latest allegations may be temporary. Sunny Agrawal, head of fundamental equity research at SBICAPS Securities, noted, "This is a temporary, knee-jerk reaction. Things will get back to normalcy."
Despite the pressure, the Adani Group has seen some investor confidence restored through investments from Abu Dhabi-based International Holding and U.S. investment firm GQG Partners, which helped narrow its losses from $150 billion to about $32.5 billion since the first Hindenburg report in January 2023.
Looking ahead, Adani Enterprises is planning to launch a $1 billion share sale by mid-September, following a previously shelved $2.5 billion offer. Additionally, Adani Energy recently raised $1 billion from U.S. investors and sovereign wealth funds.
The political implications of these allegations are also gaining traction. While ruling Bharatiya Janata Party lawmaker Ravi Shankar Prasad dismissed the allegations as baseless, opposition leader Rahul Gandhi expressed concerns on X, formerly Twitter, stating, "The integrity of SEBI, the securities regulator entrusted with safeguarding the wealth of small retail investors, has been gravely compromised by the allegations against its chairperson."
(Source:www.invesitng.com)