The Adani case gets curious and curiouser. Now that the Supreme Court has absolved SEBI (Securities & Exchange Board of India) of any lapses in investigating whether there was any truth in the Hindenburg Report of January which accused infrastructure — airports, marine ports, cement, grain silos and edible oils, media — developer Gautam Adani of fraud stock price manipulation, money laundering etc, which sent the value of all Adani group equity shares crashing, wiping out almost Rs.10 lakh crore by February 5, Adani shares have started climbing again. Moreover, R.N. Bhaskar, author of Gautam Adani: The Man who Changed India (2022), says that Adani owns “hundreds” of cargo ships, each registered under separate companies and foreign flags, and can be bought and sold overnight and several companies in Australia, Dubai, Israel and Egypt. They are legally entitled to purchase Adani company shares.
Therefore, the only subsisting charge against Adani is that through these and other opaque firms, he has breached Rule 19 of SEBI regulations that disallows promoters from holding more than 75 percent of the equity in any listed company.
One wonders why it’s necessary to impose a ceiling on promoters’ shareholding. True it will create a shortage of tradable shares in the marketplace, but it also reflects a promoter’s confidence in the success of his enterprise. In this particular case even if as alleged, Adani holds a greater percentage of arbitrarily imposed ceiling and raises funding against inevitably higher valued stock to build force multiplier infrastructure, the strategy works in the public interest.
As to the question why the Adani wealth meltdown has attracted so much comment in this education magazine, while Adani has suffered a massive loss, your editor — a bona fide investor in the India growth story — has also lost a bundle.
