The ports-to-energy conglomerate — controlled by billionaire Gautam Adani, one of the world’s richest people — has seen shares in its seven companies lose more than $100 billion in market value since the Jan 24 report by Hindenburg Research, which accused it of improper use of offshore tax havens and stock manipulation. Adani has denied the charges. Last week, the group’s flagship entity Adani Enterprises pulled its secondary share offering, India’s largest ever, because of the sharp selloff.
SEBI and the Adani Group did not respond to requests for comment about the investigation. Great International Tusker Fund and Ayushmat Ltd also did not respond to requests for comment.
Also under the SEBI scanner are Elara Capital and Monarch Networth Capital, two of the 10 investment banks that managed the share offering, the sources said, adding that SEBI had approached the two firms last week.
The roles of Elara and Monarch are being examined by the market watchdog to rule out “any conflict” in the share offering process, one of the sources said.
Shares in Adani Enterprises extended their losses to 5% in Friday afternoon trade following Reuters’ report, having previously been down 2.5% earlier in the day.
MEETING WITH MODI’S OFFICE
Hindenburg has alleged one Adani private entity had a small ownership stake in Monarch – which has previously worked as a bookrunner for the group – saying “this close relationship seems to pose an obvious conflict of interest.” The short-seller also alleged that a Mauritius-based fund of Elara has invested 99% of its market value in three Adani stocks.
Adani has said Monarch was selected for previous share sales “for their credentials and ability to tap into the retail market”. On Elara, Adani has said “innuendoes” that the firm was in any manner related to the conglomerate founders were incorrect.