Hindenburg faces Sebi scrutiny, Kotak Bank dragged in Adani saga

Adani-Hindenburg Case: Hindenburg Research's disclosure of suspected violations by Sebi regarding Adani Group's short bet led to minimal gains, highlighting challenges foreign investors face under Indian securities rules..

US-based short-seller Hindenburg Research whose report on Gautam Adani-led Adani Group last year triggered a rout in the group's stocks, has come out with a note stating India's market regulator Sebi had sent it a letter outlining suspected violations over its short bet against Adani Group last year and revealed it may "barely come out above breakeven" on its trade...

The short seller also stated Kotak Mahindra Bank created and oversaw an offshore fund structure that was used by its "investor partner" to bet against the conglomerate, providing new details of trades that have puzzled investors...

The short seller's response stated: While Sebi seemingly tied itself in knots to claim jurisdiction over us, its notice conspicuously failed to name the party that has an actual tie to India: Kotak Bank, one of Indias largest banks and brokerage firms founded by Uday Kotak, which created and oversaw the offshore fund structure used by our investor partner to bet against Adani..

"In our view, Sebi has neglected its responsibility, seemingly doing more to protect those perpetrating fraud than to protect the investors being victimized by it," Hindenburg said.. "Today we are sharing the entirety of this notice, frankly because we think it is nonsense, concocted to serve a pre-ordained purpose: an attempt to silence and intimidate those who expose corruption and fraud perpetrated by the most powerful individuals in India," the short-seller's notice further stated...

You might be interested in