Adani group stocks in focus amid report of regulatory scrutiny in US

Shares of Adani group companies including Adani Enterprises Ltd, Adani Green Energy Ltd, Adani Power Ltd and Adani Total Gas Ltd will be in focus on Friday morning amid a Bloomberg report suggesting US authorities have been looking into representations that Adani Group made to American investors following Hindenburg Research's scathing report. In January, the short seller had accused the group of using offshore companies to manipulate its share prices. Hindenburg Research also accused the group companies of accounting fraud.

As per the Bloomberg report, the US Attorney’s Office in Brooklyn, New York, has sent inquiries in recent months to institutional investors with large holdings in the India conglomerate, one person familiar with the inquiries said.

The requests for information were focused on what Adani Group told those investors, a person told Bloomberg, who asked not to be identified because the probe was not public. The Securities and Exchange Commission also has a similar probe underway, two other people told Bloomberg.

That said, requests for information from US prosecutors does not necessarily mean that criminal or civil proceedings will be filed as law enforcement agencies often open inquiries that does not lead to action.

A spokesperson for Ahmedabad-based Adani Group told Bloomberg it was not aware of any subpoenas to investors.

“Our various issuers groups remain confident that the disclosures are full and complete as disclosed in the relevant issuer offering circulars," the spokesperson said. The group has denied the short seller’s accusations.

As per the latest Hurun list, eight of 10 listed Adani Group companies saw Rs 10,25,955 crore or 52 per cent erosion in their market capitalisation in six months up to April as against a decline of just 6 per cent by the top 500 companies during the same period. The eight companies had a combined value of Rs 9.5 lakh crore and constitute 4.5 per cent of the total value of 500 top companies, the Hurun list suggested.

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