India's opposition has urged the head of the country's main market regulator to step down following allegations by US-based short-seller Hindenburg Research that past investments may have influenced an investigation into the Adani Group. The Adani Group, a major Indian conglomerate with interests ranging from ports to power, lost $150 billion in market value last year due to a damning report by Hindenburg accusing it of engaging in blatant corporate fraud. The Supreme Court of India instructed the Securities and Exchange Board of India (Sebi) to look into these accusations. Subsequently, Hindenburg alleged that Sebi chairperson Madhabi Puri Buch and her husband had investments in offshore funds linked to a senior member of the Adani family. Buch has dismissed these accusations as unfounded, and the Adani Group has labeled Hindenburg's latest claims as malicious, mischievous, and manipulative.
Rahul Gandhi, leader of the opposition Congress party, stated that the securities regulator had been significantly compromised and demanded her resignation, along with a joint parliamentary investigation. Gandhi emphasized that the integrity of Sebi, which is responsible for protecting the interests of small retail investors, has been severely undermined by these allegations. He questioned why Sebi chairperson Madhabi Puri Buch had not resigned yet. Gautam Adani, founder of the family-run conglomerate and ranked 12th richest person in the world by Bloomberg, refuted Hindenburg's initial allegations, describing the report as a calculated move to harm the company's reputation to benefit short-sellers. Hindenburg also claimed that Vinod Adani, Gautam's older brother, oversees a complex network of offshore shell companies in tax havens such as Mauritius, Cyprus, and various Caribbean islands.
Hindenburg, citing whistleblower documents, further accused Buch and her husband of having investments in offshore funds that were also allegedly used by Vinod Adani. Buch denied this accusation, and Sebi stated that the allegations against the Adani Group had been thoroughly investigated, with only one investigation still pending. Mahua Moitra, a member of the opposition All-India Trinamool Congress party, argued on social media that there was no national interest in defending a compromised regulator who should resign. Gautam Adani is seen as a close ally of Prime Minister Narendra Modi, and critics argue that this relationship has enabled him to secure business deals unfairly and evade proper scrutiny. Shares of Adani Group companies experienced a decline in early trading on Monday, with Adani Enterprises dropping by as much as 5.5 percent before recovering some ground. Other Adani Group stocks, including Adani Total Gas and Adani Energy Solutions, also saw partial recovery in afternoon trading.
