In January 2023, Hindenburg Research made significant waves by accusing the Adani Group of blatant stock manipulation and a fraudulent accounting scheme. Despite the ports-to-power conglomerate's denial of these accusations, the market reacted strongly, leading to a massive sell-off that erased billions of dollars from the market value of its listed entities, though the shares have since rebounded. Recently, Hindenburg has added another twist by accusing Kotak, one of India's major private sector banks, of facilitating an offshore fund structure for Hindenburg's investor partner to short Adani's stock. Kotak Mahindra International Limited has denied these allegations.
The accusations against Kotak surfaced in a broader blog post where Hindenburg also revealed receiving a show cause notice from the Securities and Exchange Board of India (SEBI) related to the Adani Group case. Hindenburg stated that the notice from SEBI outlined "suspected violations of Indian regulations."
The Adani-Hindenburg case began in January 2023 when Hindenburg published a report accusing the Adani Group of using a network of offshore shell entities controlled by Gautam Adani's brother, Vinod Adani, and close associates. According to the report, billions of dollars were secretly moved through these entities into and out of Adani's public and private companies, often without proper related-party disclosures. The report also alleged that opaque offshore fund operators helped Adani circumvent minimum shareholder listing rules, leading to a substantial sell-off in Adani Group stocks. Adani has consistently denied these allegations, describing the report as malicious, mischievous, and lacking research.
Comments