The Adani-Hindenburg row continues to make headlines as the Supreme Court gave a three-month extension to SEBI to conclude its investigation into the Hindenburg report, and the Mauritian finance minister rejected the allegations of Hindenburg Research that the Adani group has a web of shell entities based in Mauritius.

The apex court had directed SEBI to investigate any securities law violations by the Adani Group in March 2023 following the release of the Hindenburg report. The capital market regulator SEBI had sought an extension of six months to arrive at verified findings and conclude the investigation about possible violations related to misrepresentation of financials, circumvention of regulations, and fraudulent transactions.

Vishal Tiwari, a petitioner, had objected to SEBI’s request for a time extension. The Securities Contracts (Regulation) Rules of 1957, which mandate the maintenance of a minimum public shareholding in a public limited company, were allegedly violated. Still, SEBI had not explicitly referred to an inquiry into the claimed infringement, the court had noted during the previous hearing of the case. To evaluate the current regulatory system that protects investors, the apex court established a six-member committee under former apex court judge Justice AM Sapre.

Meanwhile, Mauritian finance minister Mahen Kumar Seeruttun rejected the allegations of Hindenburg Research that the Adani group has a web of shell entities based in Mauritius. He called the allegations “false” and “baseless,” adding that shell companies are prohibited in Mauritius. According to Mauritian laws, an overseas company must carry out income-generating activities in or from Mauritius. It needs to be managed and controlled by the country and administered by a management company.

In January, Hindenburg Research alleged that the Adani Group engaged in billions of US dollars in suspicious dealings with its chairman’s brother, Vinod Adani, and his labyrinth of offshore shell entities. The Adani Group responded that they are neither aware nor required to be mindful of their “source of funds.” Hindenburg Research identified 38 shell entities based out of Mauritius controlled by Vinod Adani or other close associates of the Adani Group.

Since the Hindenburg report was released, the Adani group’s cumulative market capitalisation has fallen by 49% to Rs 11.2 lakh crore. However, news of the group flagship Adani Enterprises looking to raise funds to $2.5 billion resulted in positive sentiment in the group stocks on Thursday – all the 10 group stocks witnessed a rally today, with the combined market capitalisation rising by over Rs 30,000 crore.