Adani Group shares hold fort amid Hindenburg response to SEBI

Unlike the earlier instances, investors gave a cold shoulder to the fresh salvo fired by the US short-seller Hindenburg in response to SEBI’s show-cause notice in the case involving the Adani Group.

Most Adani Group stocks traded firm for most part of the trading on Tuesday, but closed flat. The Group’s flagship firm, Adani Enterprises was down one per cent at ₹3,151 while Adani Ports dipped marginally by 0.03 per cent to ₹1,474. Ambuja Cements and Adani Green were down 0.42 per cent and 0.16 per cent to ₹692 and ₹1,773. Adani Power dipped one per cent to ₹711.

The other group company shares which ended in green include Adani Total Gas and NDTV shares (up 2 per cent each), while Adani Wilmar and ACC (one per cent each). Adani Energy Solutions was up two per cent.

• Also read: Chronology of events in the Hindenburg-Adani case

Amit Goel, Co-Founder and Chief Global Strategist, Pace 360 PMS, said SEBI’s show-cause was about examining the accuracy of Hindenburg Research claims, its impact on the markets, whether it engaged in market manipulation and other unlawful activities.

Hindenburg has claimed that the notice as nonsense and accuses it of trying to silence and intimidate those who expose corruption and fraud by powerful individuals in India, he said.

For Hindenburg Research, the show-cause notice could mean regulatory scrutiny and potential legal consequences, depending on the findings of SEBI’s investigation, he added.

• Also read: Hindenburg says it made only $4 million by shorting Adani stocks, bonds

In the 46-page show-cause notice, SEBI details Hindenburg’s relationship with an investor who took a short position in Adani company stocks. In response, Hindenburg stated that it had one investor partner and after accounting for costs, it might “barely come out above breakeven”.

Last year, Hidenburg Research had made serious allegation on the Adani Group and this triggered a sharp selloff in the Group’s stocks. Following the report, Adani Group’s market value plunged by around 65 per cent or ₹12.4 lakh crore, to below ₹7-lakh crore. However, it regain the market-cap early this year as the Group reduced its leverage across businesses.

The Adani Group denied the allegations in a 413-page response.

In January, hearing a public interest litigation, the Supreme Court dismissed the plea for probe by Special Investigation Team and ordered SEBI to investigate the issue.