Hindenburg report had targeted misinformation, outdated allegations: Gautam Adani

Five months after a bombshell short seller report impacted the market value of his empire, Gautam Adani has reiterated the confidence of his ports-to-energy conglomerate, emphasising its strong governance and disclosure standards. In the annual report of Adani Enterprises Ltd, the flagship firm of the Adani Group, the chairman stated that a panel of experts appointed by the Supreme Court found no regulatory failures.

On January 24, Hindenburg Research accused Adani of stock manipulation, accounting fraud, and utilising a complex network of shell companies for illicit money movements. The Adani Group strongly denied these allegations and labeled the report as a calculated attack on India.

Timing suspect?

Adani noted that the report was published on the occasion of India’s Republic Day. The report caused a significant decrease in the market value of the group’s listed companies, resulting in Adani losing the title of richest Indian.

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Adani described the report as a combination of targeted misinformation and outdated allegations aimed at damaging the group’s reputation and driving down stock prices. He mentioned that despite issuing a comprehensive rebuttal promptly, various entities with vested interests tried to exploit the claims made by the short seller and spread false narratives through news and social media platforms.

He referred to the expert committee constituted by the Supreme Court to investigate the matter. The committee consisted of individuals known for their independence and integrity. Adani stated that the committee found no regulatory failures and cited credible charges of concerted destabilization of the Indian markets. The panel also confirmed the quality of the group’s disclosures and found no instances of regulatory failure or breaches.

‘Compliant with regulations’

While the Securities and Exchange Board of India (SEBI) is yet to submit its report on a separate probe into the allegations against the Adani Group, Adani expressed confidence in their governance and disclosure standards. The group issued a statement emphasising that they were unaware of any subpoenas from American authorities to US investors following the Hindenburg allegations. The statement reiterated that Adani’s portfolio companies and businesses have acted in compliance with the regulations and accounting standards of the jurisdictions in which they operate.

The statement urged against unnecessary speculation and called for waiting for SEBI and the Supreme Court to complete their work and submit their findings. Adani’s group operates with a robust corporate governance framework and is committed to adhering to all applicable laws and regulations.

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The statement clarified that four of the portfolio companies (AGEL, ATL, APSEZ, and AEL) issue global capital market paper, with only APSEZ being a corporate issuer. Most of the bond issuances by Adani Portfolio Companies are made under specific regulations and are listed on SGX and/or India INX.

These bonds adhere to the guidelines of the Reserve Bank of India and are subject to stringent regulations and disclosure requirements. The offering circulars for these bonds contain comprehensive disclosures, and post-issuance disclosures and filings are made in accordance with relevant regulatory requirements, said Adani.

With agency inputs