Shares of Adani Group companies fell on Monday after US short-seller Hindenburg Research alleged the head of India’s market regulator previously held investments in offshore funds also used by the group.
Billionaire Gautam Adani’s flagship company Adani Enterprises fell nearly 5%, while Adani Ports, Adani Total Gas, Adani Green, Adani Power, Adani Wilmar and Adani Energy Solutions fell between 3% and 8%.
Citing whistleblower documents, Hindenburg said on Saturday that Securities and Exchange Board of India (Sebi) Chair Madhabi Puri Buch and her husband held stakes in an offshore fund where a substantial amount of money was invested by associates of Vinod Adani, brother of Gautam Adani.
A personal statement from Buch on Sunday said all disclosure requirements had been followed diligently and that investments in the fund referred to in the Hindenburg report were made in 2015 in a private capacity, two years before she joined Sebi.
Adani Group on Sunday rejected the allegations and said its overseas holding structure was fully transparent.
“Under Buch, the market regulator has taken a lot of measures to protect retail investor sentiment. But allegations that came over the weekend have shaken market confidence, which can have an impact on retail investor sentiment,” said Anita Gandhi, founder and head of institutional business at Arihant Capital Markets.
In January 2023 Hindenburg released a report alleging improper use of tax havens and stock manipulation by Adani Group, which led to a stock rout. Adani Group has denied all of the allegations and shares have partially recovered. The allegations led to a Sebi inquiry, which is still underway.
Reuters
