On Thursday, Adani enterprises issued a statement to the stock exchange confirming that it had not hired accountancy firm Grant Thornton for an independent audit of some of its companies. “We would like to clarify that the said news item appears to be a market rumour and hence it would be inappropriate on our part to comment on it,” the company said to BSE.
“We wish to confirm that we have made and will continue to make disclosures in compliance with our obligations under the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and our agreements with the stock exchanges. You are requested to take the above on your records,” the statement added.
On February 14, several reports indicated that the Adani Group hired accounting firm Grant Thornton to conduct independent audits of several of its subsidiaries in an effort to refute charges made by short-seller Hindenburg Research that have hurt its stocks and bonds. Reports also mentioned that Grant Thornton would investigate whether related-party transactions at the Adani Group conformed with corporate governance rules.
A day earlier, on February 13, Adani Group, during a market crash following a short-seller report, declared that each of its portfolio firms’ balance sheets was very healthy, that it had good corporate governance, and that its assets were secure.
On the same day, market regulator Securities and Exchange Board of India (SEBI) said that it was looking into the Hindenburg report as well as market behaviour before and after it was published.
Since the news of the study by US-based short-seller Hindenburg surfaced, the market value of Gautam Adani’s group has dropped by almost $120 billion. The Adani Group has refuted accusations of ‘brazen stock manipulation and accounting fraud… over the course of decades’ and has since made an effort to reassure investors by highlighting a robust balance sheet in response to worries over an excessive amount of debt.
According to the reports, the Congress party has also approached SEBI and the Reserve Bank of India, demanding for a probe into how public financial institutions have been exposed to the crisis. According to the Group, it has safe assets, excellent cash flow, fully financed business plans, and is still confident in the continuing potential of its portfolio to produce exceptional returns to shareholders.
The controversy surrounding the Adani Group has also sparked political conflict in India, with opposition parties, such as the Congress, accusing the ruling Bharatiya Janata Party of favouring Adani, who is from Gujarat, the home state of PM Narendra Modi.
The Supreme Court meanwhile has received several petitions calling for investigations into the different accusations, and it is scheduled to hear a number of them on Friday. To safeguard the interests of thousands of investors, the top court has already urged the government to establish a “robust framework” by modifying the legislation and enhancing the supervision provided by SEBI.
