AEL, Adani Transmission, Adani Green shares fall on Sebi probe; Adani group m-cap drops Rs 10,800 cr

Adani Transmission, Adani Green Energy and Adani Enterprises (AEL) were among six Adani group stocks that fell in Monday's trade, as Sebi was reportedly probing possible violation of 'related party' transaction rules in the Adani group's dealings with at least three offshore entities. These entities, a Reuters report suggested, are said to have links to Vinod Adani, Gautam Adani’s elder brother.

By 10.15 am, the Adani group had lost Rs 10,765 crore in market value, as the group's capitalisation (m-cap) dropped to Rs 9.03 lakh crore from Rs 9,14,126.11 crore on Friday. Shares of Adani Transmission quoted 2.98 per cent lower at Rs 968.10. NDTV shares declined 2.70 per cent to Rs 187.

Adani Green Energy, AEL and Adani Wilmar dropped 2.27 per cent, 1.89 per cent 1.69 per cent, respectively. Adani Ports and Special Economic Zone fell 0.8 per cent to Rs 626.20.

Four group stocks namely ACC, Adani Power, Adani Total Gas and Ambuja Cements rose half-a-per cent each.

Data showed while Adani group m-cap has recovered smartly from a low of Rs 6,81,971.49 crore on February 27, it is far from Rs 19,19,888.44 crore it commanded on January 24 when the scathing report by the US-based short seller Hindenburg Research was published.

The report had alleged that Gautam Adani’s elder brother Vinod Adani was key in managing a network of offshore entities to facilitate fraud. It had alleged that Vinod Adani through close associates, “manages a vast labyrinth of offshore shell entities”.

The Reuters report quoting sources with direct knowledge of the matter said the three entities allegedly entered into several investment transactions with unlisted units of the Adani Group over the last 13 years, adding that Vinod Adani is either a beneficial owner, director or has links with these three offshore entities. The market regulator is now probing whether lack of that disclosure violated 'related party transaction' rules, the report suggested.

The three offshore entities with alleged links to Vinod Adani being probed for 'related party' transactions are Mauritius-based Krunal Trade and Investments Ltd and Gardenia Trade and Investments Ltd, and Electrogen Infra in Dubai.

As per Indian laws, direct relatives, promoter groups, and subsidiaries of listed companies are considered related parties. A promoter group is defined as “an entity that has a large shareholding in a listed company and can influence company policy”.

Transactions between such entities have to be disclosed in regulatory and public filings at the bourses and require shareholder approval above a specified threshold. If such norms are violated, the involved companies can be asked to pay monetary fines.

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