Amid Hindenburg Research’s new report on Adani Group, a lookback at its past disclosures

The Adani Group had witnessed a massive fall in market cap and share prices of its listed companies following Hindenburg’s allegations in January 2023.

By: Express Web Desk

New Delhi | Updated: August 11, 2024 09:04 AM IST

3 min read

Hindenburg Research is now a prominent investment research firm founded by Nate Anderson.

US-based short-seller Hindenburg Research, which had put out allegations of stock manipulation and accounting fraud against the Adani Group early this year, returned with another set of claims about the company on Saturday night.

Raising questions of conflict of interest related to the market regulator, Hindenburg Research alleged that “it suspects SEBI’s unwillingness to take meaningful action against suspect offshore shareholders in the Adani Group may stem from SEBI Chairperson Madhabi Buch’s complicity in using the exact same funds used by Vinod Adani, brother of Gautam Adani.”

Madhabi Puri Buch and her husband Dhaval Buch said in a statement that they strongly denied the “baseless allegations and insinuations made in the report”. “The same are devoid of any truth. Our life and finances are an open book,” they said in a joint statement.

When it had first accused the Adani group of stock manipulation, the company had witnessed a massive fall in market cap and share prices of its listed companies following Hindenburg’s allegations in January 2023. It also resulted in the Group calling off AEL’s fully subscribed Rs 20,000 crore FPO.

In the month of July this year, the Supreme Court had dismissed a petition seeking a review of its January 3, 2024, ruling which rejected demands for a court-monitored probe by the Central Bureau of Investigation or a Special Investigation Team into allegations raised against the Adani Group companies by the firm in a report.

Dismissing a batch of four petitions, the Supreme Court had said, “SEBI (Securities and Exchange Board of India) has prime facie conducted a comprehensive investigation… no apparent regulatory failure can be attributed to SEBI based on the material before this Court. Therefore, there is prima facie no deliberate inaction or inadequacy in the investigation by SEBI.”

Hindenburg Research is a prominent investment research firm founded by Nathan (Nate) Anderson, known for its critical reports which are often followed up by legal or regulatory action.

Some of its big reports include:

🔴 Its September 2020 report, ‘Nikola: How to Parlay An Ocean of Lies Into a Partnership With the Largest Auto OEM in America’ where “with the help of whistleblowers and former employees, the firm called out a vast array of alleged lies and deceptions by Nikola in the years leading up to its proposed partnership with General Motors”. Nikola is an American energy solutions company that manufactures electric vehicles.

Story continues below this ad

🔴 Other mentions in the track record, according to its website, include WINS Finance, which Hindenburg revealed had failed to disclose to US investors an RMB 350 million asset freeze imposed on one of its subsidiaries in China.

🔴 The “zombie company” China Metal Resources Utilization, which had a “100% downside” and was “under severe financial distress” with “numerous accounting irregularities.”

🔴 A whistleblower report that Anderson submitted to the United States Securities and Exchange Commission (SEC) “relating to RD Legal, a hedge fund that was later charged by the commission for allegedly making material misstatements to its investors”.

From the homepage