Adani Group Faces Regulatory Scrutiny from SEBI
India's Securities and Exchange Board of India (SEBI) has sent notices of regulatory violations to six companies of the Adani conglomerate, including its flagship Adani Enterprises. This comes after a probe was initiated into the group following allegations of improper use of tax havens and stock manipulation by Hindenburg Research in January 2023.
Adani Enterprises received two notices from SEBI in the March quarter, citing non-compliance with provisions for listed companies and violation of disclosure rules on some related-party transactions. The company maintains that these notices have no "material consequential effect" on their financial statements and that they have not materially violated any applicable laws or regulations.
Other Adani group companies, including Adani Power, Adani Total Gas, Adani Energy Solutions, Adani Wilmar, and Adani Ports, have also received notices from SEBI. These notices raise concerns about unreported third-party transactions, lack of proper review and approvals, and the validity of auditor peer review certificates.
As a result of the SEBI investigations, auditors for Adani Ports, Adani Power, and Adani Enterprises have issued qualified opinions. This means they are unable to comment on the potential impact of the investigations on the financial statements or the company's compliance with regulations.
The Adani group has denied all allegations made by Hindenburg Research. The outcome of the SEBI investigations remains pending.