Adani Group gets a clean chit in Hindenburg case: What does SEBI’s final order say? | Explained News

After an exhaustive investigation, SEBI has reaffirmed what we have always maintained, that the Hindenburg claims were baseless. Transparency and integrity have always defined the Adani Group.

We deeply feel the pain of the investors who lost money because of this fraudulent… pic.twitter.com/8YKeEYmmp5

— Gautam Adani (@gautam_adani) September 18, 2025

Hindenburg’s allegations against Adani Group

On January 24, 2023, Hindenburg Research, a US-based financial research firm and short seller, in a 106-page report, accused the Adani Group of pulling off “the largest corporate fraud in history,” alleging stock manipulation, accounting irregularities, and use of offshore shell companies to artificially inflate share prices.

It also claimed violations of public shareholding norms and raised concerns about the group’s high debt levels and related-party transactions.

The report alleged that related entities such as Adicorp Enterprises Pvt Ltd, Milestone Tradelinks Pvt Ltd and Rehvar Infrastructure Pvt Ltd were used by the Adani Group as conduits to route funds from various group companies to listed companies – Adani Enterprises Ltd and Adani Power Ltd.

“Despite Adicorp Enterprises’ modest financial profile, four Adani Group companies lent the company a total of Rs 620 crore ($87.4 million) in 2020. We found no disclosure of these transactions in the financial statements of the Adani Group lenders, several of which are publicly listed,” the Hindenburg report had said. Given its net profit, it would take Adicorp Enterprises around 900 years to earn enough to pay back the loans even without interest, Hindenburg had said in the report.

Notably, Hindenburg Research no longer exists. In January this year, the short-seller’s founder Nate Anderson announced the ‘disbandment’ of the firm.

Following Hindenburg’s allegations, Adani Group’s shares tanked sharply, with its flagship Adani Enterprises sliding 70 per cent. The group’s market capitalisation plunged by around $150 billion. The group later announced plans to cancel Adani Enterprises’ fully-subscribed Rs 20,000 crore follow-on public offer (FPO) and returned the money to investors.

To investigate if there was a regulatory failure in dealing with the alleged contravention of laws pertaining to the securities market by the Adani Group, the Supreme Court, on March 2, 2023, had set up an expert committee headed by a former judge Justice A M Sapre. The other committee members included former SBI Chairman OP Bhatt, former ICICI Bank Chairman KV Kamath, Infosys Chairman Nandan Nilekani and High Court judge Somsekhar Sundaresan.

The apex court also directed SEBI to conclude the investigation and file a status report. The committee presented its report dated May 6, 2023.

Upon completion of investigation, SEBI issued a show cause notice (SCN), dated January 15, 2024, to Adani group firms and officials based on findings of investigation.

SEBI finds no violations by Adani Group

Considering the allegations made in the Hindenburg Report, SEBI carried out a detailed investigation in the matter in order to ascertain whether the listed Adani Group companies misrepresented financial statements to circumvent the SEBI Act; SEBI (Listing Obligations and Disclosures Requirements (LODR) ) Regulations, 2015; SEBI (Prohibition of Fraudulent and Unfair Trade Practices (PFUTP) Relating to Securities Market) Regulations, 2003 or any other rules or regulations for two different periods.

In case of Adicorp Enterprises, the investigation period was from financial year 2012-13 to 2020-21, and for Milestone Tradelinks Pvt. Ltd and Rehvar Infrastructure Pvt. Ltd, from financial year 2018- 19 to 2022-23.

In two final orders, SEBI gave clean chit to Gautam Adani, Rajesh Adani, Jugeshinder Singh, the group chief financial officer (CFO), and key Adani Group firm – Adani Enterprises, Adani Ports & Special Economic Zone Ltd and Adani Power Ltd.

“Having considered the matter holistically, I find that the allegations made against Noticees (Adani group firms and officials) in the SCN are not established. Considering the above, the question of devolvement of any liability on Noticees does not arise and hence the question of determination of quantum of penalty also does not require any deliberation,” Sebi’s whole time member, Kamlesh Varshney, said in the order.

“I hereby dispose of the instant proceedings against Noticees without any direction,” he wrote in the order.

SEBI orders said that there were no allegations of siphoning of money or diversion of funds or loss to investors in this case. All the loans with interest were paid back even before the start of the investigation.

“In my view, there are a few important facts like – there is no allegation of siphoning off of money or diversion of fund or loss to investors; all the money has come back with interest before start of the investigation; and the impugned transactions have not been held as related party transactions; which will make it very difficult to call impugned transactions as manipulative or fraudulent transactions or unfair trade practice,” Varshney wrote in final orders.

“Once there is no requirement of disclosures / approval, most of the clauses of the definition of the term ‘fraud’ would become inapplicable,” he said.

Since it has already been held that facts of this case do not meet the requirement of the definition of the term “fraud”, it is held that for this reason there is no violation of provisions of the PFUTP regulations by notices, he said.

Stance vindicated, says Adani

In a post on X, Gautam Adani said that after an exhaustive investigation, SEBI has reaffirmed what the group has consistently maintained — that the Hindenburg allegations were “baseless”.

“We deeply feel the pain of the investors who lost money because of this fraudulent and motivated report. Those who spread false narratives owe the nation an apology,” Adani said.