Adani CFO says SEBI notices were procedural

26 Jun 2024 , 01:15 PM

Adani Group’s CFO said on Tuesday that Sebi letters to its half-dozen listed firms were procedural and inconsequential, and that the conglomerate was in compliance with rules. Seven of the Adani group’s ten listed entities announced in May that they had received show cause notices from the Securities and Exchange Board of India (Sebi) for suspected violations of related party transactions and noncompliance with listing regulations.

“Some (notices) are trivial,” CFO Jugeshinder Singh told reporters.

One of the notices concerns share trading history, while another inquires about the grounds for disclosing peer audit results a few days after the March 31 deadline, he added.

There was no misconduct, and the group complied with all regulations, he stated. “If there was any violation, Sebi would have leaked (it to the media or markets) by now,” he joked.

“There are no serious issues… only procedural issues pertaining to listed companies, and we will deal with it,” he told reporters.

The Sebi notifications are part of an investigation launched after US short-seller Hindenburg Research made serious charges of corporate malfeasance and stock price manipulation against the Adani Group in January 2023. Though Adani adamantly rejected all charges, the revelation caused a stock sell-off that reduced the group’s market value by almost USD 150 billion to its lowest point.

The majority of the group’s stocks have rebounded as the ports-to-energy conglomerate devised a recovery strategy.

A show cause notice is not an indictment; it seeks explanations from entities as to why legal action should not be taken against them.

AGEL described the notices as “technical in nature” with “no material consequential effects on the relevant financial statements,” whereas AEL stated that “there is no material consequential effect of above show cause notices to relevant financial statements and no material non-compliance with applicable laws and regulations.”

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