Adani Group has once again entered into a yet another fresh controversy after the US prosecutors indicted him, his nephew Sagar Adani and six others for allegedly offering Rs 2,029 crore ($265 million) in bribes to Indian government officials for securing “lucrative solar energy supply contracts” with state electricity distribution companies. Gautam Adani and his conglomerate has been under the scanner since the US short selling company Hindenburg Research released a scathing report in January, 2023. 

Almost a month after the Hindenburg report lopped off over $135 billion in market value from Gautam Adani’s empire, the billionaire had hired top-shelf US crisis communication and legal teams, scrapped a $850 million coal plant purchase, reined in expenses, repaid some debt and promises to repay more. Later in December, the conglomerate raised over USD 5 billion (Rs 41,500 crore) in equity and a double of that in debt as the apples-to-airport group made a comeback after being hit by the bombshell short seller report. 

While the company saw signs of improvement with Adani Enterprises posting Q2FY25 net profit skyrocketing nearly eightfold on-year to Rs 1,742 crore and revenue rising 16 per cent to Rs 22,608 crore, Gautam Adani was caught in another pickle with today’s indictment by the US Securities and Exchange Commission (SEC). 

Following today’s indictment, stocks of Adani Group companies fell as much as 20 per cent to intra-day low on Thursday, November 21. Reacting to this, GQG Partners, a prominent investment firm, confirmed it is monitoring the situation. GQG noted it is closely reviewing the latest developments and is evaluating whether any action is necessary in relation to its portfolio holdings. “Our team is reviewing the emerging details and determining what, if any, actions for our portfolios are appropriate,” GQG stated.

Here is a list of controversies clouding the Adani Group since 2023…

November 2024: US charges Gautam Adani, 7 others in $265 million bribery case

US prosecutors in New York indicted Adani Group Chairman Gautam S Adani, his nephew Sagar Adani and six others on Wednesday for allegedly offering Rs 2,029 crore ($265 million) in bribes to Indian government officials for securing “lucrative solar energy supply contracts” with state electricity distribution companies. On Thursday, India Time, the US Attorney’s office in New York released a press release stating that a five-count criminal indictment was unsealed in federal court in Brooklyn charging Gautam Adani, Sagar Adani and Vneet Jaain, with conspiracies to commit securities and wire fraud and substantive securities fraud for their roles in a multi-billion-dollar scheme to obtain funds from US investors and global financial institutions on the basis of false and misleading statements.  

In a parallel move, the Securities and Exchange Commission charged Gautam Adani and Sagar Adani, and Cyril Cabanes, with conduct arising out of a massive bribery scheme. SEC filed two complaints in the US District Court for the Eastern District of New York.

The US Attorney, in a release, said, as alleged in the indictment, between approximately 2020 and 2024, the defendants agreed to pay more than $250 million in bribes to Indian government officials to obtain lucrative solar energy supply contracts with the Indian government, which were projected to generate more than $2 billion in profits after tax over an approximately 20-year period (the Bribery Scheme).  

August 2024: Hindenburg drags SEBI Chief in ‘Adani money siphoning scandal’

On August 10, 2024, Hindenburg Research released a report accusing the chairperson of India’s stock market regulator, Securities and Exchange Board of India (SEBI) who is overseeing the investigation, of having a stake in obscure offshore entities allegedly involved in ‘Adani money siphoning scandal’. The report, released nearly 18 months after Hindenburg’s first report raising concerns about wrongdoing and stock price manipulation within the Adani group of companies, alleged that SEBI did not act on claims it made in its 2023 report against the Adani Group because SEBI Chief Madhabi Puri Buch had investments in offshore firms linked to the conglomerate.

Citing documents from whistleblowers, the short seller had claimed that the Sebi chief and her husband Dhaval Buch had made investments, dating back to 2015, in offshore funds in Bermuda and Mauritius linked to entities allegedly used by the Adani Group to manipulate financial markets.

A day later, SEBI had issued a statement saying that it had ‘duly investigated’ Hindenburg’s allegations against the Adani Group. It also said that its chairperson had made the required disclosures in ‘terms of holdings of securities and their transfers’, and that she had recused herself in matters involving ‘potential conflicts of interest’.

Further, the SEBI chairperson and her husband too issued a joint statement denying all charges. They said that it was an attempt of “character assassination.

After these allegations, on August 12, shares of Adani Group companies, including Adani Enterprises, Adani Ports, and Adani Green Energy, fell by up to 7 per cent. Adani Enterprises and Adani Ports, both part of the Nifty 50 index, experienced declines of up to 5 per cent before recovering slightly from their lowest points of the day. Other stocks within the group, such as Adani Energy Solutions, Adani Wilmar, and Adani Total Gas, saw their shares fall between 5 per cent and 7 per cent.

January 2023: Hindenburg accuses Adani Group of financial misconduct and stock manipulation

On January 24, 2023, Hindenburg Research published a scathing report titled “Adani Group: How The World’s 3rd Richest Man Is Pulling the Largest Con in Corporate History”, accusing the conglomerate of financial misconduct and stock manipulation. Following the release of the report, Adani group stocks tanked by up to 10 per cent. The report alleged that Adani Group of companies manipulated its share prices. It accused the Adani Group of pulling “the largest con in corporate history” by using a web of companies in tax havens to inflate its revenue and manipulate stock prices, even as debt piled up.

The conglomerate had denied the allegations. Gautam Adani, later in his address at Adani Enterprises’ AGM, had said that the report was a calculated strike designed to defame Adani Group with the intention of doing the maximum damage. “Typical short sellers target gains from financial markets. This was different. It was a two-sided attack — a vague criticism of our financial standing and, at the same time, an information distortion campaign, dragging us into a political battlefield,” Adani had said.

In February 2023, a public interest litigation (PIL) was filed in the Supreme Court, calling for the formation of a committee under a retired judge to investigate the allegations. On March 2, 2023, the Supreme Court set up a six-member expert committee “to investigate if there was a regulatory failure in dealing with the alleged contravention of laws pertaining to the securities market in relation to the Adani Group or other companies.” In May 2023, the court-appointed expert committee submitted its report. On May 17, 2023, the Supreme Court granted SEBI an extension until August 14, 2023, to report on its investigation into Adani’s stock price manipulation allegations. On November 24, 2023, the Supreme Court reserved its verdict on multiple petitions related to the Adani-Hindenburg dispute. On January 3, 2024, the Supreme Court declined to transfer the investigation to a special team and instructed SEBI to complete its probe into two pending cases within three months. Later in June 2024, Hindenburg reported receiving an email from SEBI on June 27, followed by a show cause notice regarding alleged violations related to bets on Adani stocks.

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