Markets regulator Securities and Exchange Board of India (SEBI) has alleged Pranav Adani, director of several Adani group companies and the nephew of the billionaire founder, Gautam Adani, shared price -sensitive information and breached regulations aimed at preventing insider trading,
says a report from Reuters.
Pranav Adani was sent a notice by the SEBI last year, which alleged he shared information about Adani Green Energy Ltd's 2021 acquisition of SoftBank-backed SB Energy Holdings with his brother-in-law before the deal was announced, the report says, quoting a source and from a related document.
Responding to Reuters over email, Pranav Adani says he was seeking to settle the charges "to put an end to the matter, without admission or denial of the allegations" and that "he has not violated any securities law."
According to the report, Pranav Adani communicated unpublished price-sensitive information (UPSI) pertaining to the SB Energy acquisition to his brother-in-law Kunal Shah and violated norms related to insider trading rules in 2021.
The SEBI document, which showed call records and trading patterns reviewed in the investigation reveals that Kunal Shah and Nrupal Shah, his brother, then traded in shares of Adani Green and made 'ill-gotten gains' of Rs9mn (million), Reuters says.
The Shah brothers told the agency that the trades were not executed with the 'knowledge of any unpublished price sensitive information nor with any mala fide intent'.
Adani Green’s acquisition of SB Energy in May 2021 at an enterprise value of US$3.5bn (billion) is the largest acquisition in the renewable energy sector in India so far.
In November last year, ratings agencies Fitch Ratings and Moody's downgraded ratings or changed outlook for Adani group companies, citing governance risk stemming from bribery and other charges facing the group promoter and senior employees.
In that month, the US Securities and Exchange Commission (SEC) has summoned Gautam Adani and his nephew Sagar Adani, alleging their involvement in a US$265mn bribery scheme. The case accuses the Adani executives of using bribes to secure contracts for the 'manufacturing-linked projects,' pivotal to their renewable energy ventures, while misleading investors during a 2021 bond offering.
Moody's says these rating actions follow the indictment of Adani Green's chairman, Gautam Adani, and several senior management team members by the US attorney's office in a criminal case and the filing of charges by the SEC in a civil case. The charges and allegations include bribery of Indian government officials, securities and wire fraud, conspiracy to violate the US Foreign Corrupt Practices Act and obstruct justice, false statements made in AGEL's annual reports, and false statements made to the US government in relation to its investigation into the group.
"Although the allegations and the charges made by the US attorney's office and SEC pertain to AGEL's chairman and senior management team members, we believe they could have a broader credit impact on all rated Adani group issuers, given Gautam Adani's prominent role as chairman of each of the rated entities or their parent companies as well as the controlling shareholder," the rating agency says.
The Adani group issuers affected by the change are: Adani Green Energy Ltd restricted group (AGEL RG-1), Adani Green Energy Ltd restricted group (AGEL RG-2), Adani Transmission Step-One Ltd (ATSOL), Adani Electricity Mumbai Ltd (AEML), Adani Ports and Special Economic Zone Ltd (APSEZ) and Adani International Container Terminal Pvt Ltd (AICTPL). (
Read: 7 Adani Group Entities' Outlook Changed to Negative by Moody's Ratings)
Remember even in USA, for Insider trading high position people have been STRIPPED of their Directorship & sent to jail with huge penalties!
It's high time INDIA SEBI don't let such people scot free & builds fool proof case prosecution