News

Published: June 24, 2023
Updated: June 24, 2023

Adani Group Faces US Regulatory Scrutiny, Shares Witness Decline

Shares of Adani Group companies have experienced a decline of up to 6% following reports of regulatory scrutiny in the United States. The US Attorney's Office in Brooklyn, New York, has initiated inquiries into the conglomerate after a scathing report from a short seller. The investigation focuses on the representations made by Adani Group to its American investors and alleged manipulation of share prices through offshore companies.

Shares Witness Decline:

The flagship company of Adani Group, Adani Enterprises, saw a significant drop of 6% to Rs 2,251 on the BSE during intra-day trade. Other companies within the group, including Adani Ports and Special Economic Zone, Adani Power, Adani Total Gas, Adani Transmission, Adani Green Energy, Adani Wilmar, Ambuja Cements, and ACC, also experienced a decline ranging from 2% to 4%. In comparison, the S&P BSE Sensex was down by 0.28% at 63,061 in the early morning trade.

US Regulatory Inquiries:

The US Attorney's Office in Brooklyn, New York, has reached out to institutional investors with significant holdings in the Adani Group, seeking information regarding the representations made by the conglomerate. These inquiries come after a short seller's report accused the company of manipulating its share prices through the use of offshore companies. The investigations are ongoing and aim to determine the veracity of the allegations.

SEBI Investigation and Expert Committee Report:

The Securities Exchange Board of India (SEBI) is conducting its investigation into the allegations made by the foreign short seller. The investigation also encompasses market activity before and after the specified date. The SEBI's verdict is expected to be announced in August. In contrast, a panel of experts appointed by the Supreme Court, in its report last month, found no evidence of regulatory failure or wrongdoing in the fluctuations of Adani stocks.

Adani Group's Response:

Adani Group maintains that it is fully compliant with all laws, rules, and regulations and expresses confidence in the truth prevailing. The conglomerate is fully cooperating with SEBI and providing the necessary support for their investigation. Adani Group urges the media to refrain from speculation and await the completion of SEBI's work and the findings of the Expert Committee appointed by the Supreme Court.

The Adani Group's shares have faced a decline amidst reports of regulatory scrutiny in the United States. The US Attorney's Office is investigating the representations made by the conglomerate to its American investors following allegations of share price manipulation.

While SEBI conducts its investigation, the Adani Group maintains its compliance with all regulations and expresses confidence in a favourable outcome. It is essential to await the completion of these investigations to determine the validity of the allegations made against the conglomerate.