Today is an extremely crucial day for Indian billionaire Gautam Adani as the Supreme Court will pronounce its verdict on the Adani-Hindenburg case at 10:30 AM. The decision is likely to have a direct impact on the shares of Adani Group companies trading on the stock markets.
Background of the Case
In January 2023, the US-based short seller Hindenburg Research released a report accusing the Adani Group of stock manipulation and accounting fraud. This led to the Adani Group losing over $60 billion in market value overnight.
Here is a quick recap of the key events:
- January 24, 2023: Hindenburg releases report making serious allegations against Adani Group
- January 25: Adani stocks start crashing, Group loses $50 billion in 2 days
- January 27: Adani calls off $2.5 billion FPO amid stock rout
- February 2: NSE puts Adani Enterprises, ACC, Ambuja Cements under short-term additional surveillance measure
- February 16: SEBI forms panel to conduct forensic audit of 3 Adani companies
What Happened During the Last Supreme Court Hearing
On November 24, 2023, the Supreme Court heard arguments from both sides and reserved its judgment.
Key observations made by SC:
- Cast doubts over SEBI investigation and expert panel’s impartiality
- Said Hindenburg report cannot be considered gospel truth
- No reason to distrust SEBI without basis
The remarks were seen as positive for the Adani Group. Soon after, Adani stocks rebounded sharply.
Adani Makes Strong Comeback After Rout
In his 2023 New Year message to employees, Gautam Adani asserted that the Group has made a resilient comeback after the Hindenburg crisis and even posted record profits.
As per Adani, 2023 was a challenging year but ended on a strong note, setting the stage for continued future growth.
Why Today’s Verdict Holds Significance
Experts say the Supreme Court order can have wider implications:
- If judgment favors Adani Group, it will vindicate its stand
- Strengthen investors’ confidence in the conglomerate
- Boost stock prices further
However, if the court passes any strictures against the Group or refers the matter for further investigation by an external agency, it may reignite downside risks for Adani stocks.
What to Expect Ahead?
While no outcome can be preempted at the moment, all eyes remain centered on how markets and investors react to the apex court ruling later today.
The court’s dictum will also set a precedent regarding regulatory oversight in cases of short-seller reports making serious allegations against Indian corporates.
The Adani-Hindenburg case and its eventual climax will highlight the transparency and ethical standards guiding the conduct of business and investments in the world’s fifth largest economy.