'Discredited short-seller, recycled claims': Adani Group on Hindenburg's new report
Mumbai: The Adani Group has dismissed the latest report from the US-based short-seller Hindenburg Research, calling it "recycled claims" that had previously been "proven baseless and dismissed by the Supreme Court." The ports-to-power conglomerate stated that the allegations were driven by personal gain, with no regard for facts or the law.
"For a discredited short-seller under the scanner for several violations of Indian securities laws, Hindenburg's allegations are no more than red herrings thrown by a desperate entity with total contempt for Indian laws," the group said in an exchange filing.
The statement referred to the show-cause notice issued by SEBI, the markets regulator, last month to Hindenburg and its sole beneficial owner, Nathan Anderson.
In July, the Securities and Exchange Board of India highlighted violations by Hindenburg and Anderson under the SEBI Act, SEBI's Prevention of Fraudulent and Unfair Trade Practices regulations, and SEBI's Code of Conduct for Research Analysts regulations.
Full Statement by Adani Group
Hindenburg Report - A Red Herring
The latest allegations by Hindenburg are malicious, mischievous and manipulative selections of publicly available information to arrive at pre-determined conclusions for personal profiteering with wanton disregard for facts and the law. We completely reject these allegations against the Adani Group which are a recycling of discredited claims that have been thoroughly investigated, proven to be baseless and already dismissed by the Hon'ble Supreme Court in March 2023.
It is reiterated that our overseas holding structure is fully transparent, with all relevant details disclosed regularly in numerous public documents. Furthermore, Anil Ahuja was a nominee director of 3i investment fund in Adani Power (2007-2008) and, later, a director of Adani Enterprises until 2017.
The Adani Group has absolutely no commercial relationship with the individuals or matters mentioned in this calculated deliberate effort to malign our standing. We remain steadfastly committed to transparency and compliance with all legal and regulatory requirements.
For a discredited short-seller under the scanner for several violations of Indian securities laws, Hindenburg's allegations are no more than red herrings thrown by a desperate entity with total contempt for Indian laws.
Spokesperson, Adani Group
The statement came after the chief of markets regulator SEBI denied the report and called it an attempt at "character assassination".
SEBI chairman Madhabi Puri Buch and her husband Dhaval Buch, in a statement, called the report an attempted "character assassination" in response to the SEBI's July action against the short-seller.
SEBI Chairman Madhabi Puri Buch and her husband Dhaval Buch labelled the Hindenburg Research report as "baseless allegations and insinuations." Photo credit: Wikipedia
SEBI chief's full statement:
In the context of allegations made in the Hindenburg Report dated August 10,2024 against us, we would like to state that we strongly deny the baseless allegations and insinuations made in the report. The same are devoid of any truth. Our life and finances are an open book. All disclosures as required have already been furnished to SEBI over the years. We have no hesitation in disclosing any and all financial documents, including those that relate to the period when we were strictly private citizens, to any and every authority that may seek them. Further, in the interest of complete transparency, we would be issuing a detailed statement in due course.
It is unfortunate that Hindenburg Research against whom SEBI has taken an Enforcement action and issued a show cause notice has chosen to attempt character assassination in response to the same.
Madhabi Puri Buch
Dhaval Buch
What is Short Selling and who is Hindenburg Research?
According to Investopedia, short selling is a trading strategy where investors speculate on a stock's decline. A short seller (read Hindenburg) bets on, and profits from a drop in a security’s price. Traders use short selling as speculation, and investors or portfolio managers may use it as a hedge against the downside risk of a long position.
Founded by Nate Anderson, US-based Hindenburg Research LLC specializes in forensic financial research.
Wikipedia mentions Hindenburg as an investment research firm with a focus on activist short-selling. Named after the 1937 Hindenburg disaster, which they characterize as a human-made avoidable disaster, the firm generates public reports via its website that allege corporate fraud and malfeasance.
According to an explainer by Vox.com, Anderson, Hindenburg founder, is a short seller, meaning he stands to make money if the price of Adani Group company shares and bonds fall. He makes those prices fall with the report, it said.
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