The Supreme Court verdict on the Adani-Hindenburg Research row was long awaited. The apex court today directed SEBI to complete the probe within three months. Here's a timeline of what happened.
January 24: Adani Enterprises had been preparing to launch an FPO (follow-on public offer) when, on January 24, the New York-based short-seller Hindenburg Research came out with a sensational report that levelled a series of allegations against the group including stock-market manipulation and accounting fraud.
January 25: The Adani group dismissed the report terming it a “malicious combination of selective misinformation and stale, baseless and discredited allegations”.
The BSE 30-share index fell by 1.27%, the nine Adani group companies’ market capitalization collectively lost by a wider 4.5%.
January 26: Adani Group said it is evaluating legal action against Hindenburg Research.
January 27: Adani Group stocks fell 5-20%, wiping out Rs, 3.19 trillion in investor wealth. Congress leader Jairam Ramesh demanded “serious investigations” by the RBI and market regulator SEBI into the series of allegations levelled against the Adani Group by
US short seller Hindenburg Research. “High exposure of institutions such as LIC and SBI to Adani Group has implications for financial stability and for savings of crores of Indians”
January 29: Adani Group called the New-York based research boutique the “ “Madoffs of Manhattan” in a note to its stakeholders. The 413-page response remarks that the “admitted short-seller” is driven by an “ulterior motive”. Hindenburg replied to Adani: Fraud Cannot Be Obfuscated By Nationalism Or A Bloated Response That Ignores Every Key Allegation We Raised. Adani Failed To Specifically
Answer 62 of Our 88 Questions "fraud is fraud", even when it’s perpetrated by one of the wealthiest individuals in the world ---Hindenburg said in a reply not January 30th:
The Budget session of Parliament is set for a stormy start as the opposition parties have demanded a debate on the Adani Hindenburg Research report controversy.
Life Insurance Corporation of India (LIC) on Monday said it is sitting on substantial mark to market (MTM) gains despite Adani Group company shares taking a beating . It said it is closely examining the Group’s rebuttal of Hindenburg Research’s allegation
January 31: Most of the Adani Group stocks posted modest gains on Tuesday after the flagship Adani Enterprises Ltd (AEL) follow-on public offer (FPO ) was subscribed fully. Barring three, all other Adani Group stocks outperformed the benchmark indices on Tuesday.
In a huge relief for billionaire Gautam Adani, institutional investors and family offices of high net worth individuals (HNIs) salvaged the Rs. 20,000 crore follow-on public offering (FPO) of Adani Enterprises Ltd, ensuring the issue was subscribed 1.12 times, up from just 0.03 times the previous day.
Food giant Wilmar International Ltd. will continue to support its joint venture with Adani Group.
Feb 1: Adani calls off Rs.20,000cr FPO. The company will return the proceeds received from FPO, mainly bailed out by corporates and foreign investors in the face of market volatility. Credit Suisse has stopped accepting bonds of Adani Group companies as collateral for margin loans to its private banking clients.
In the Forbes list of richest persons, Adani fell from third spot last week to 14th after Wednesday’s stock rout, with his personal net worth tumbling to $ 77 billion, down $11 billion in a day.
Feb 2: Gautam Adani, in a video statement, reasoned the protection of investor interest behind cancelling the fully-subscribed follow-on public offer (FPO). In a statement, he said it would “not be morally correct” to go ahead with the FPO in light of the market volatility.
Reserve Bank of India asking banks to share the details of the loans sanctioned by them to the group companies, even as most banks, especially private players, are said to be declining fresh proposals from the Adani Group. The Opposition demanded a joint parliamentary committee ( JPC) probe or inquiry supervised by the Chief Justice of India into the Adani Group Hindenburg row.
Citigroup’s wealth unit has decided to stop accepting its securities as collateral for extending margin loans t o its clients.
Feb 3: S&P Global Ratings said it has revised the rating outlook for Adani Electricity Mumbai and Adani Ports to ‘negative’ from ‘stable’, on concerns of increased capital cost and reduced funding access. This is the first rating action by a global rating agency after Hindenburg Research published its report.
Feb 6: British lender Standard Chartered also followed suit and announced the halting of accepting Adani Group bonds as collateral on margin loans. Proceedings of both Houses of Parliament were adjourned for the third day on Monday without transacting any business as an united Opposition continued to raise slogans against what it called “Adani Sarkar” and continued to press for a JPC (joint parliamentary committee) probe into the Hindenburg allegations.
The Congress intensified its nationwide campaign against the government on this issue, questioning LIC investments into Adani firms.
Feb 8: Total Energies has put on hold a planned investment in Adani Group’s $50billion hydrogen project pending an audit following allegations by a US shortseller, chief executive of the French oil giant Patrick Pouyanne said on Wednesday.
Seven out of 10 stocks of the group finished with gains , with flagship Adani Enterprises surging nearly 20 per cent. The stock, which had crashed to a low of Rs.1,017 on February 3 following a Hindenburg report, has doubled to Rs.2,125 but is still far away from its peak of Rs.4,189.55.
Feb 9: The Supreme Court has agreed to hear on Friday a plea seeking a direction to the Centre to constitute a committee monitored by a retired apex court judge to inquire and investigate into the Hindenburg Research report which has made a slew of allegations against the business conglomerate led by industrialist Gautam Adani.
Adanis dial global hedge funds for capital
The Himachal Pradesh excise and taxation department scrutinised records and checked the stock at the Adani Wilmar warehouse in Parwanoo. Norway’s sovereign fund exits Adani firms by pulling out $200 million. Morgan Stanley Capital International (MSCI) has announced that it will review the status of Adani Group stocks in its indices amid investor concerns.
Feb 10: The Supreme Court asked the Securities and Exchange Board of India (SEBI) and the government to produce the existing regulatory framework in place to protect Indian investors, who are reported to have lost several lakh crores over the past two weeks after a US based short seller Hindenburg Research published. A Bench, comprising Chief Justice of India (CJI) D Y Chandrachud and Justices P S Narasimha and J B Pardiwala. Moody’s Investors Service on Friday confirmed the ratings of eight Adani Group companies, but changed the outlook on four to ‘negative’ from ‘stable’, the rating agency said. It retained the ‘stable’ outlook for the other four firms.
The NSE on Friday announced that Adani Ports & SEZ and Ambuja Cements will be removed from the additional surveillance (ASM) framework. The move will reduce the margin requirement for traders while dealing in these stocks.
Nathan Anderson, Founder of Hindenburg Research, whose damning report led to a $100 billion plus rout in Adani Group shares, has said that his firm has never been banned, its bank account never seized, and that it is not under any investigation.
Feb 13: The Centre and SEBI on Monday said they have no objection to the Supreme Court setting up an expert committee to examine the regulatory regime and frameworks in place for the securities market to protect investors from share value meltdowns as seen in the Adani Group, triggered by the US based short seller Hindenburg Research report on the conglomerate.
Feb 14: Gautam Adani led group’s flagship firm Adani Enterprises Ltd (AEL) on Tuesday reported a swing to profit in the quarter ended December 2022 from a loss a year before. “The current market volatility is temporary,” AEL Chairman Gautam Adani said in the earnings statement.
“As a classical incubator with a vision of long-term value creation, Adani Enterprises will continue to work with the twin objectives of moderate leverage and looking at strategic opportunities to expand and grow.”
Embattled Adani group has appointed accountancy firm Grant Thornton for an independent audit of some of its companies to come clean of the damning allegations levelled by the US short seller Hindenburg Research and to assure investors and regulators.
Feb 16: Adani Power has called off its plans to acquire thermal power assets of DB Power Ltd (DBPL ) from the Dainik Bhaskar Group for around Rs. 7,017 crore enterprise valuation.
Feb 17: The Supreme Court on Friday chose transparency over the government’s sealed cover containing “suggestions” for a committee proposed t o examine Hindenburg’s damning report on the Adani Group, saying that public confidence will take a hit if an impression is created that the Centre is steering the process with the court’s nod.
The court indicated that it would direct statutory agencies to cooperate with the proposed committee.
It dismissed the idea of having one of its sitting judges on the panel
The Bench also stopped advocates Prashant Bhushan and Neha Rathi, appearing for a petitioner, from reading out aloud in court names of former judges who could head the committee.
In a speech ahead of the Munich Security Conference, American billionaire George Soros said, “Modi is silent on the subject, but he will have to answer questions from foreign investors and in Parliament.” He added, “This will significantly weaken Modi’s stranglehold on India’s federal government and open the door to push for the much needed institutional reforms. I may be naive, but I expect a democratic revival in India.”
Feb 20: The net worth of billionaire Gautam Adani slipped to less than $50 billion for the first time in several years, with the real-time billionaires lists of both Forbes and Bloomberg ranking him as the twenty-fifth wealthiest person in the world, with a fortune of $48 billion (down $2.7 billion since yesterday) and $49.1 billion (down $1.15 billion) respectively.
Feb 21: Adani Group manipulated entries, claims Wikipedia: US firm’s founder Nate Anderson tweeted an article by The Signpost, Wikipedia’s independent newspaper, which claimed that the conglomerate “manipulated Wikipedia entries using sock puppet accounts (fake accounts), undisclosed paid editors and removing evidence of conflicts of interest”.
Feb 22: Adani Slipped to 27th rank in Bloomberg Billionaire Index
Forbes real-time ranking is 26th and the net worth is USD $46.1 billion
Feb 24: The Supreme Court rejected a plea filed by advocate ML Sharma seeking to injunct the media from reporting on the Adani-Hindenburg issue till the court delivers its verdict on the committee. “We won't injunct the media...We will pronounce our order,” Chief Justice of India Justice DY Chandrachud told Sharma.
March 2: Supreme Court forms expert panel to probe any regulatory failure on Adani issue. The expert committee’s members are former SBI chairman O.P. Bhatt, Justice J.P. Devadhar (retired), veteran banker K.V. Kamath, Infosys co-founder Nadan Nilekani and advocate Somasekhar Sundaresan. It will be monitored by former Supreme Court judge A.M. Sapre.
The Supreme Court formed a five-member expert committee headed by former apex court judge, Justice Abhay Manohar Sapre, to investigate the causal factors and existence, if any, of regulatory failure which led to investors losing crores due to the volatility in the securities market following Hindenburg Research’s report accusing the Adani Group of manipulation of share prices and account fraud. The expert committee was requested to submit its report to the Supreme Court in a sealed cover within two months.
Market regulator SEBI, agencies connected with financial regulations, fiscal agencies and law enforcement agencies have to cooperate with the expert committee.
April 29: Market regulator SEBI has told the Supreme Court that its ongoing investigations against Adani group, following the allegations made by Hindenburg Research report, are complex in nature and therefore need at least six more months to be completed.
May 1: Supreme Court gives SEBI extension till August 14 to complete probe
May 19: Sapre Panel: A Supreme Court mandated six member committee, led by former Supreme Court judge AM Sapre, stated that it was unable to conclude at present that there was regulatory failure by SEBI in the
Adani-Hindenburg case-
July 11: SC adjourns hearing of Adani-Hindenburg case: SC bench headed by CJI DY Chandrachud asks Sebi about the state of the investigation. He says the probe has to be concluded by August 14.
August 14: SEBI claims substantial progress in Adani-Hindenburg probe, Seeks seeks 15 more days to conclude the ongoing probe. It says that it has examined and investigated 24 matters about the case. "it had already probed 24 “matters”. “Out of the 24 investigations/ examinations, 17 are final and complete and approved by the competent authority in accordance with SEBI’s extant practice and procedures,”
August 25: SEBI Status Report:
In a status report filed with the Supreme Court on the Adani-Hindenburg probe, regulator Securities and Exchange Board of India said of the 24 investigations, 22 are final in nature and two are in the interim stage..
August 31: OCCRP Report:
The Organised Crime and Corruption Reporting Project (OCCRP) comes up with another report. Alleges that "hundreds of millions" of dollars were invested in publicly traded group stocks of the Adani group companies through Mauritius-based "opaque" investment funds managed by partners of the promoter family. The conglomerate rejects charges and calls them "recycled allegations".
November 24: The Supreme Court reserves its order in the Adani-Hindenburg case and indicates it might pass some more directions to Sebi. Sebi tells the court it would not seek an extension to complete its investigation of the matter.
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