More Sebi orders likely in Adani case; MPS, insider trading under lens

Sources said regulator still examining charges related to possible violations of MPS, insider trading norms

While the Securities and Exchange Board of India (Sebi) has cleared Adani Group companies and a few other entities of allegations of violating related party transaction (RPT) norms, at least two more allegations against the group remain under review, according to sources. 

 

The markets regulator is examining claims related to possible violations of minimum public shareholding (MPS) and insider trading norms, they said. Although the investigations have been completed, final orders on these issues may take more time, they added. “Different departments are looking into it,” said one of the people.

 

Emailed queries sent to Sebi and the Adani Group remained unanswered at press time.

 

On Thursday, Sebi issued two orders disposing of proceedings, without any directions, in cases linked to allegations of violations of RPT norms made by short-seller Hindenburg Research. 

 

In its orders, Sebi ruled that transactions involving Adicorp Enterprises, Milestone Tradelinks, and Rehvar Infrastructure — non-group entities flagged by Hindenburg Research — did not qualify as RPTs. The regulator observed that transactions carried out by related parties through unrelated intermediaries cannot be classified as RPTs under the pre-amendment provisions of the Listing Obligations and Disclosure Requirements (LODR) for the years under review.

 

Sebi further concluded that there was no violation of either the LODR Regulations or the Prohibition of Fraudulent and Unfair Trade Practices (PFUTP) Regulations, as alleged in its showcause notices issued in March 2024. The probe had been launched following directions from the Supreme Court.

 

In filings before the apex court in August 2023, Sebi had stated that it had completed 22 of the 24 investigations into the Adani Group, with the remaining two cases involving certain foreign portfolio investors pending, as inputs from overseas regulators and external agencies were awaited. 

Under scrutiny  

• Sebi had initiated 24 investigations in the Adani matter, according to the Supreme Court disclosures
• Possible violations of MPS norms, takeover regulations, RPT, manipulation instock prices and insider trading are being probed
• Regulator still examining allegations of flouting of MPS, insider trading norms
• The final Sebi order is expected to take a few months