Adani Under SEBI Radar Over Possible Disclosure Violation

Adani Group has now come under the radar of securities and exchange board of India (Sebi) post the United States indictment order on Friday. The regulator is investigating the Adani Group regarding possible violation of rules that mandated the disclosure of market-moving information, Bloomberg reported, citing sources. Sebi has asked the stock exchanges whether the conglomerate’s renewable energy company, Adani Green Energy, disclosed information regarding the ongoing US court’s probe or not. 

According to regulation 30 of Sebi’s listing obligations and disclosure requirements (LODR), a listed company is mandated to disclose any information deemed ‘material’ to the domestic stock market on the exchanges. Sebi’s investigation is likely to be completed in around two weeks, post which Sebi might decide to take up formal investigation against the Group. 

“Every listed entity shall make disclosures of any events or information which, in the opinion of the board of directors of the listed company, is material,” as per the SEBI LODR Regulations, 2015.  

While Sebi’s official investigation will start after substantial facts are gathered, the US court is likely to move forward with the trial. 

Previously, Sebi investigated the conglomerate after Hindenburg Research published its report in January last year accusing the Adani Group of stock manipulation and financial misconduct. 

The indictment order that surfaced on Wednesday brought Adani Group chairman Gautam Adani and his nephew Sagar Adani into spotlight. The US court in its indictment order accused Gautam Adani and his seven associates of bribing Indian officials to obtain solar energy contracts in the US and made misleading claims to raise funds from international investors. The court also issued an arrest warrant for Adani and his nephew. 

The Adani Group refuted the charges and called them baseless in a statement on November 21.  

“The allegations made by the US Department of Justice and the US Securities and Exchange Commission against directors of Adani Green are baseless and denied,” said the company. “The Adani Group... is committed to maintaining the highest standards of governance, transparency and regulatory compliance across all jurisdictions of its operations...we are a law-biding organisation, fully compliant with all laws,” the company in the statement added.