India regulator rejects US firm's fraud claims against Adani Group
SEBI says its inquiry found no regulatory violations after a 2023 short-seller report, as political controversy around the conglomerate lingers.
India's market regulator on Thursday dismissed allegations of stock manipulation and financial fraud against the Adani Group raised by U.S. short-seller Hindenburg Research, ending a long-running probe that had rattled markets and politics.
The Securities and Exchange Board of India (SEBI) began examining the conglomerate in 2023 after Hindenburg published a 106-page report accusing Adani of accounting irregularities, use of offshore shell entities to inflate share prices, and related-party transactions that were not disclosed to investors. The report, which focused on several listed Adani companies, helped wipe more than $100 billion in market value from the group in a matter of days and sparked a rancorous national debate about corporate governance and regulatory oversight in India. Hindenburg Research specializes in short-selling, betting against a company’s shares in the expectation that prices will fall.
SEBI said there were no transactions between Adani's companies and related parties that required disclosure to investors, and that the inquiry did not uncover manipulative or fraudulent activity under its rules. The regulator added that there were no allegations of money being siphoned off, funds being diverted, or investors losing money as a result of the transactions it examined. It also said that loans taken by Adani entities from any lender had been repaid even before the start of the investigation. In its order, SEBI stated that, on merit, the impugned transactions could not be classified as manipulative or fraudulent or as unfair trade practices.
Mr. Adani posted on X that the Hindenburg claims were baseless, calling the regulator’s finding a vindication for the group. The ruling arrives amid ongoing political scrutiny in India, where opposition parties have long accused the Modi government of tolerating or enabling the Adani empire’s rise due to political ties. Critics argued the Hindenburg report exposed governance concerns that warranted closer action by authorities, while supporters warned against politicizing regulatory matters. The episode has fed a broader debate in India about the balance between corporate power and governance safeguards.
The Hindenburg controversy is part of a longer arc involving the Adani Group and regulatory and political actors. In May of last year, India’s anti-corruption watchdog cleared then-SEBI chief Madhabi Puri Buch of all corruption charges stemming from Hindenburg’s allegations, a development that did little to quell ongoing debates about regulatory independence and the influence of large business groups. Earlier this year, Nate Anderson, founder of Hindenburg Research, announced that he would disband the firm after nearly eight years of public investigations and market provocations. Anderson did not offer a detailed explanation for the decision, saying only that he wished to spend more time with friends and family in the future.
The SEBI ruling focuses on whether the specific transactions scrutinized represented market manipulation or other prohibited practices under Indian securities laws. By concluding that they did not, the regulator aims to provide some closure to investors who endured a sharp decline in confidence after the 2023 report. Yet the Adani case remains a touchstone for discussions about corporate governance, regulatory oversight, and market integrity in one of Asia’s fastest-growing economies. Investors will likely watch closely for any further actions from other authorities or ongoing reviews related to related-party disclosures, accounting practices, or debt structures across the Adani group, even as SEBI’s order closes this particular inquiry.