The Adani-Hindenburg case refers to a report published by the investment research firm Hindenburg Research in June 2020, which made a series of allegations about the business practices of the Adani Group, a major Indian conglomerate
The report accused the Adani Group of various financial irregularities, including inflating the value of its ports and other assets, misrepresenting its financial health, and engaging in related-party transactions that benefited the Adani family at the expense of minority shareholders.
The Adani Group strongly denied these allegations and called the report “blatantly erroneous” and “motivated.” The group also accused Hindenburg Research of having a short position in the Adani Group’s shares, which would have given the research firm an incentive to spread negative information about the company.
Despite the Adani Group’s denials, the report caused a significant drop in the company’s stock price and led to an investigation by the Securities and Exchange Board of India (SEBI) into the allegations. The SEBI eventually cleared the Adani Group of any wrongdoing in the case in January 2021, stating that it had found no evidence of fraud or price manipulation by the company.
The Adani Group has since filed a lawsuit against Hindenburg Research in a US court, seeking damages for defamation and seeking to prevent the research firm from publishing any further reports about the company. The case is ongoing, and the outcome is yet to be determined.
The Supreme Court of India in its judgment constituting an expert committee to view the regulatory mechanism in the light of Adani in the work issue provided details regarding a note SEBI head is submitted before the bench to set out the existing statutory resign for investors in India.
The court remarked that the constitution of the expert committee did not diveste SEBI office power of Responsibility in continuing with its investigation into the volatility in the cutie market in India.
A bench comprising CJ d y Chandrachur justice PS Narasimha and Justice JV Parde wala passed judgment in petition file in the wake of the Adani group share taking a beating in the stock market following the publication of a report by USB short selling firm hindenburg research.
In order to elaborate upon the existing statutory resign regulatory mechanism and Framework in the place for production of investors as well as a regulatory Framework governing short selling
India SEBI had please note on record before the bench the following submission were made by SEBI by its note-:
SEBI had adopted disclosure base regulatory resignations for both essence of an trading and securities; this is in line with the discontinuation of pricing control for capital issues in favor of the principle of free Discovery by the market based on demand and supply from informed investors.
2) SEBI is strongly and educate empower to put in place regulatory Framework for affecting stable operation and development of securities market including protection of investors
3)SEBI had an extension to Framework governing investing production in the context of the subject matter at hand.
4) As per Sevi the key pillars of investors’ production include mandatory disclosure by listing companies to facilitate free and fair by Discovery market system to ensure seamless trading and settlement including volleytality management and enforcement action in the event of misconduct in the market including fraud or violation of SEBI regulation.
The bench also considered the following points:
It appear that SEBI is seized of the investigation into the allegation made against the Adani group company fabi has not especially referred to an investigation into the early to violation of security contract regulation rules 1957 which provide for the maintenance of minimum public shareholding in a public limited company similarly there may be a various other allegations that saving must including in its investigation.
The bench director SEBI to expeditiously conclude the investigation with in 2 month and file a status report and added-
The constitution of expert committee does not diverse sev office power Responsibility in continuing with its investigation in the recent volatility the securities market the court expert committee to preview the regulating material in the light of the army human issue the remit of the committee has follows:
1) to provide an overall assessment of the situation including the relevant causal factors which have led to the volatility in the security market in the recent past.
2) to suggest measures of strength and invested awareness.
3) to investigate whether there has been the clip tea failure in dealing with the elite contribution of laws per training to the security market in relation to the Adani group and other companies.