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Synopsis : Adani Group faces SEBI scrutiny for alleged breaches in transactions and listing rules; SEBI probes follow Hindenburg Research allegations.
Adani Enterprises, the leading entity in Gautam Adani's business realm, disclosed receiving two show-cause notices by the end of March. Additionally, Adani Ports & Special Economic Zone, Adani Power, Adani Energy Solutions, Adani Wilmar, and Adani Total Gas notified stock exchanges about SEBI's recent inquiries.
Six Adani Group companies revealed in their regulatory filings that they've been served show cause notices by SEBI for purported breaches in related party transactions and non-compliance with listing regulations. Adani Enterprises, the group's flagship, acknowledged receiving two such notices during the quarter ending March 31.
Adani Enterprises highlighted SEBI's allegations of non-compliance with listing agreement provisions and LODR regulations concerning related party transactions and the validity of statutory auditors' peer review certificates for earlier years.
While legal counsel suggests minimal impact from these notices, auditors—excluding those of Adani Wilmar and Adani Total Gas—remain cautious, anticipating potential implications on future financial statements due to SEBI's investigations.
In response, Adani Power stated that SEBI alleged certain transactions weren't reported in relevant financial statements, lacking necessary approvals. Adani Ports and SEZ mentioned allegations of non-disclosure in financial statements and failure to recall security deposits against terminated contracts, breaching the company's code of conduct.
SEBI's scrutiny follows allegations against the Adani Group by Hindenburg Research, with SEBI identifying specific related party transactions under investigation in its report to the Supreme Court. The Hindenburg Report questioned the appropriateness of over 6,000 related party transactions, shadowing the Adani Group's operations.
Amidst these proceedings, Adani Enterprises referenced a short seller's report published in March 2023, leading to petitions filed with the Supreme Court for an independent investigation. The SC directed SEBI to conduct additional investigations and complete pending ones, aiming for a resolution within three months, aligning with the law.
Related Questions
1. What are the allegations made against Adani Group by Hindenburg Research?
Hindenburg Research made allegations against the Adani Group regarding over 6,000 related party transactions, questioning their appropriateness and casting shadows on the group's operations.
2. What are the specific breaches alleged by SEBI against Adani Group companies?
SEBI alleges breaches in related party transactions and non-compliance with listing regulations by Adani Group companies, including failure to disclose transactions in financial statements and lacking necessary approvals.
3. How did Adani Group respond to SEBI's notices?
Adani Group companies responded to SEBI's notices by acknowledging them in regulatory filings and addressing specific allegations, including non-compliance with listing agreement provisions and LODR regulations.
4. What actions did the Supreme Court take in response to the allegations against Adani Group?
The Supreme Court directed SEBI to conduct additional investigations and complete pending ones within three months, aiming for a resolution of the allegations against Adani Group.
