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HomeNewsSebi looking into 'market allegations' against Adani: Finance Ministry

Sebi looking into ‘market allegations’ against Adani: Finance Ministry

The finance ministry on Monday informed the Lok Sabha that stock market regulator Securities and Exchange Board of India (Sebi) is investigating market allegations against the Adani group, and the volatility in the stocks of these companies has not had any significant impact at the systemic level.

Minister of state for finance Pankaj Chaudhary, in written replies to various questions asked by parliamentarians, stated that the government has not constituted any committee to investigate the allegations made against the Adani Group of companies by short-seller Hindenburg Research of the United States.

In reply to one of the questions in Lok Sabha, Chaudhary said Sebi conducts investigations into any alleged violations of its regulations by any market entity.

“It is, accordingly, undertaking investigation into the market allegations against the Adani Group,” he said, noting that the nine listed companies forming part of Adani Group witnessed a decline of around 60% of market capitalisation from January 24, 2023, till March 1, 2023 subsequent to the Hindenburg report.

“The volatility in the stocks of these companies has not had any significant impact at the systemic level. Nifty 50 declined by around 4.5% during the same period,” he stated in his reply.

In reply to another question, the Lok Sabha was told that the Life Insurance Corporation of India (LIC) has informed that its debt exposure to Adani Group was ₹6,182.64 crore as on March 5, against ₹6,347.32 crore on December 31, 2022.

“The five public sector general insurance companies have informed that these companies do not have loan/credit exposure to Adani Group,” the ministry noted in response to a question in Lok Sabha.Public sector banks have informed that loans are sanctioned after assessing the viability of projects, prospective cash flows, risk factors and availability of adequate security and repayment of loans are ensured by the revenue generated by the project and not by the market capitalisation of the company, the ministry said.

On investigation by DRI

A separate investigation into imports of Indonesian coal by the conglomerate hasn’t reached finality, Chaudhary said.

To a separate question on investigation by the Directorate of Revenue Intelligence (DRI) into import of power generation and transmission equipment by Adani, he said the probe has “concluded” and the “report has been submitted before the relevant judicial authorities”.

He, however, did not reveal the findings.

On the alleged irregularities in imports of Indonesia coal by the Adani Group, he said, “Investigations by DRI have not reached finality as information sought from exporting countries through execution of Letters Rogatory is under litigation.”

Hindenburg Allegations

Chaudhary said Sebi had told the Supreme Court that it was “already enquiring into the allegations made in the Hindenburg report as well as the market activity immediately preceding and post the publication of the report, to identify violations of Sebi Regulations.

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