ET Explains: Allegations against Adani Group, Sebi probe and SC Order
The Adani Group has steadfastly denied the allegations that first surfaced about a year ago, causing the erosion of about $150 billion in market capitalization before stock prices recovered steadily through the year.
The origins of the Adani case:
On January 24, 2023, US-based short seller Hindenburg Research published a report alleging malfeasance by the Adani Group. That included cooking books of accounts, over-invoicing of import costs and round-tripping of own money to push up share prices.
Following the report, share prices of Adani entities tumbled. The conglomerate, helmed by Gautam Adani, denied the Hindenburg allegations but that did little to lift the group's market capitalisation.
Subsequently, several public interest litigations (PILs) were filed before the Supreme Court, seeking a probe into the Hindenburg allegations and their impact on the Indian securities market.
What were these PILs about?
Four PILs were filed before the apex court.
The first raised concerns about the drastic fall in the securities market, the impact on investors, the purported lack of redressal and the disbursement of loans to the Adani Group without due procedures. It sought the constitution of a committee monitored by a retired judge of the Supreme Court to investigate the Hindenburg report.
The second PIL said the group violated India's public holding norms by «surreptitiously controlling more than 75% of the shares of its listed companies, thereby manipulating the prices of its shares in the market». It sought a court-monitored investigation by an SIT or by the CBI into the matter.
The third PIL sought the investigation of Adani Group's financial transactions, including the role of Life Insurance Corp (LIC) and the State
