Adani Group firms settle SEBI's Hindenburg-linked probe for ₹1.5cr
What's the story
Five companies of the Adani Group have settled adjudication proceedings with the Securities and Exchange Board of India (SEBI) for a total of ₹1.51 crore. The settlements stem from alleged non-disclosure of related-party transactions (RPTs). The case was prompted by SEBI's investigation into allegations of undisclosed RPTs and corporate governance lapses highlighted by Hindenburg Research's report.
List
Companies that settled with SEBI
The companies that have settled are Adani Enterprises, Adani Green Energy, Adani Total Gas, AWL Agri Business, and Adani Energy Solutions.
Under the terms of the settlement recommended by SEBI's High Powered Advisory Committee and accepted by a panel of whole-time members, each company has paid a specific amount.
Adani Enterprises paid ₹76.05 lakh, while Adani Green Energy paid ₹45.50 lakh.
Notices
SEBI issued show-cause notices in February 2024
The other companies, Adani Total Gas, AWL Agri Business, and Adani Energy Solutions each paid ₹9.75 lakh.
SEBI had issued show-cause notices to these firms in February 2024 for not disclosing certain RPTs in their annual reports as per the applicable accounting standard, and violating the erstwhile listing agreement.
The audit and limited review reports of several group companies between 2015 and 2021 were also signed without a valid peer review certificate.
Past settlements
Proceedings against companies disposed
The settlement order noted that the adjudication proceedings against the companies have been disposed of.
Earlier this month, Adani Ports and Special Economic Zone MD Karan Adani and CFO B Ravi had also settled adjudication proceedings with SEBI in a matter involving PMC Projects.
They each paid ₹13.65 lakh under the settlement mechanism, after which the proceedings were disposed of.
Regulatory perspective
SEBI closed proceedings against Adani Group last year
Last September, SEBI had closed proceedings against Adani Group companies, their chairman Gautam Adani, and other entities over allegations of fund diversion, RPT violations and fraud.
In two separate orders, the regulator exonerated the group from allegations made by short-seller Hindenburg Research in 2023.
It ruled that transactions between Adani Group companies and firms flagged by Hindenburg could not be classified as RPTs.