High noon for Adani…

As PS goes to press, the release of the findings of the Securities and Exchange Board of India (SEBI) into accusations by US-based Hindenburg Research that the Adani Group is guilty of “brazen stock manipulation and accounting fraud schemes” is imminent.

This follows on from the SEBI requesting 15 more days to complete its inquiry. At this stage it stated that it had “substantially progressed” its investigations =- 17 of 24 investigations were “final and complete” and another completed with an interim report approved by the competent authority.

With the remaining six investigations four were reported as under process of approval by the competent authority, one with an interim report under preparation and the other at an ‘advanced stage.’

Speculation is rife as to what the report, being submitted to the Supreme Court, will contain with views spanning the full range of options from measures right through from no negative findings to a hard hitting report.

The report follows hot on the heels of the resignation of Deloitte, the Adani Ports division’s auditor, citing the lack of a wider audit role as a reason. The net effect of this has been to provide new energy to the Adani Group – Hindenburg Research controversy, and particularly as a result of the fact that Deloitte identified certain transactions that it had concerns about which Adani did not want to independently look into.

As of mid- August, it was estimated that shares of Adani’s 10 listed companies had recouped around US$47 billion in value having lost US$150 billion of their joint value in the wake of the Hindenburg report.