Adani fault lines raise bar for India’s regulator

Indian billionaire Gautam Adani speaks during an inauguration ceremony after the Adani Group completed the purchase of Haifa Port earlier in January 2023, in Haifa port, Israel January 31, 2023. REUTERS/Amir Cohen Acquire Licensing Rights

MUMBAI, Aug 31 (Reuters Breakingviews) - Some potentially controversial ultimate owners of Gautam Adani’s stock have been identified in the aftermath of U.S. short-seller Hindenburg Research’s attack in January on the tycoon’s $130 billion power-to-coal empire. It was a hunt an Indian panel probing allegations of stock manipulation warned might be "a journey without a destination".

India’s Securities and Exchange Board of India, the country’s markets regulator, is awaiting data from five offshore tax havens to identify the actual beneficiaries behind a number of foreign investment vehicles that hold stakes in the conglomerate. Its tough chair, Madhabi Puri Buch, has uncovered some violations that could incur no more than monetary penalties, Reuters reported on Monday. It’s unclear if she’s on the same trail that the Organized Crime and Corruption Reporting Project has just laid out: it says Nasser Ali Shaban Ahli from the United Arab Emirates and Taiwan’s Chang Chung-Ling could be associates of Vinod Adani, Gautam Adani’s brother.

It raises the bar for SEBI - and the panel reviewing its findings. Adani on Thursday rejected OCCRP’s claims, saying they are based on decade-old closed cases. Shares of Adani Total Gas (ADAG.NS), a joint venture with France’s Total, and Adani Power (ADAN.NS) and Adani Enterprises (ADEL.NS) fell 2.5%, 3.5% and 3% respectively. Investors have erased $105 billion from the group’s market value since Hindenburg’s report but evidently need more convincing that serious financial punishment and any threat of forced delisting is truly past. (By Una Galani)

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