Markets regulator Securities and Exchange Board of India (SEBI) on Thursday cleared Adani Group and its billionaire chairman, Gautam Adani, of allegations of impropriety that had been levelled by US-based Hindenburg Research pertaining to routing funds through three entities to hide related party transactions.
In two separate orders published on the market regulator’s website, the regulator said it found no violations, saying that at the time, such transactions with unrelated parties “did not qualify as related party dealings” since the definition was expanded only after a 2021 amendment.
It also noted that the “loans were repaid with interest, no funds were siphoned off, and hence there was no fraud or unfair trade practice”. As a result, all proceedings against the Adani Group have been dropped, it stated.
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In 2023, shortseller Hindenburg alleged that the Adani Group used three companies – Adicorp Enterprises, Milestone Tradelinks, and Rehvar Infrastructure – as conduits to route money between Adani group firms since it helped Adani avoid rules on related party transactions, possibly misleading investors.
The Adani Group had repeatedly denied the allegations, although it ended up losing about $2.43 bn, or 1 percent, in market value as a result of the report being made public.
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