Adani Group Shares Slide Amid Fresh Allegations By Hindenburg Research, SEBI Defends Chairperson

Adani Group's shares continued to face pressure on Monday after Hindenburg Research, in a recent report, accused Securities and Exchange Board of India (SEBI) Chairperson Madhabi Puri Buch of having a stake in offshore entities allegedly involved in the Adani money siphoning scandal.

Adani Enterprises shares dropped by 3.09%, while Adani Energy Solutions opened 17% lower on the BSE. Adani Power, Adani Green Energy, and Adani Total Gas also saw declines of 4.98%, 6.96%, and 5.57%, respectively. Adani Wilmar opened 3.88% down, and NDTV plunged 11%.

Despite these developments, the Sensex fell by 375.79 points, or 0.47%, and Nifty decreased by 47.45 points, or 0.19%, at the market opening.

On Saturday, citing "whistleblower documents," Hindenburg alleged that SEBI Chairperson Madhabi Puri Buch and her husband, Dhaval Buch, had stakes in obscure offshore entities used in the Adani money siphoning scandal.

In response, the Gautam Adani-led Adani Group denied Hindenburg's allegations on Sunday, calling them "malicious, mischievous, and manipulative." The group reiterated that its overseas holding structure is fully transparent, with all relevant details regularly disclosed in public documents.

"The Adani Group has no commercial relationship with the individuals or matters mentioned in this calculated effort to malign our standing. We remain committed to transparency and compliance with all legal and regulatory requirements," the group said in a statement.

The Adani Group also criticized Hindenburg, referring to it as a discredited short-seller under investigation for violating Indian securities laws. The latest allegations, the group argued, are merely attempts to distract, with little regard for Indian laws.

However, these allegations had minimal impact on domestic equity market indices, with the Sensex and Nifty remaining relatively stable.

V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services, commented, "Domestically, the Hindenburg report and its potential fallout appear unlikely to significantly affect the market. The 'buy on dips' strategy that has worked well during this bull run is likely to remain effective."

In response to Hindenburg's claims, SEBI defended Madhabi Puri Buch, stating that the regulator has adequate internal mechanisms to address conflicts of interest, including a disclosure framework and recusal provisions.

SEBI also advised investors to "remain calm and exercise due diligence" before reacting to such reports, noting that Hindenburg Research may have short positions in the securities mentioned in the report.

In a joint statement, Madhabi Puri Buch and her husband clarified that the investment in the fund mentioned in the Hindenburg report was made in 2015, when they were private citizens living in Singapore, nearly two years before Madhabi joined SEBI as a Whole Time Member.

Madhabi Puri Buch, an IIM Ahmedabad alumna, became a Whole Time Member of SEBI in 2017 and its Chairperson in March 2022. The joint statement emphasized that SEBI's institutional mechanisms for disclosure and recusal were diligently followed, including the disclosure of all securities held or subsequently transferred.

On Monday, Hindenburg Research responded by alleging that Madhabi Puri Buch ensured accounts linked to Adani were registered solely in her husband Dhaval Buch's name two weeks after her appointment as SEBI Chairperson and that the funds were redeemed through her husband's name.