A Supreme Court-appointed panel reported it has observed suspicious trading in Adani group shares by four foreign portfolio investors, one corporate and one individual.
The trading pattern is suspicious due to the growth of short positions by these six entities in the Adani group scrips before the release of the Hindenburg Research report. They earned substantial profits by squaring off their positions after the report got published.
A detailed investigation is being executed because of trading with these entities.
Between April 1st 2018 to December 31st 2022, 849 alerts were received by the Securities and Exchange Board of India (SEBI) in Adani group scrips. Out of which, 603 alerts were related to price volume movements. The remaining 246 alerts were for inside trading.
The stock exchange has submitted three examination reports to SEBI. The work is under process on them.
For Adani Enterprises, the parent company of the port-to-power conglomerate, no evident pattern of manipulative contribution has been accredited to a single entity or group of entities.
The committee has asked the capital market regulators to prepare detailed charts and data for price movements across all Adani group stocks. They need to present these reports for analysis.
Hindenburg Research report claimed that Adani’s empire was the “biggest con in corporate history,” and indulged in a “brazen stock manipulation and accounting fraud scheme.”
After the publication of the Hindenburg Research report on January 24th, the Adani group denied all allegations, comparing the US-based short-seller’s report to an attack on India. However, the conglomerate’s stock prices nosedived after the report was published and it lost over US$140bn in market capitalisation.
