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The Finance Ministry, on Monday, told Lok Sabha that volatility in stocks of Adani Group has no “significant” impact at the systemic level. It also said that SEBI is investigating the allegations of market manipulation against these companies.
In a written response, Minister of State for Finance Pankaj Chaudhary said in Lok Sabha that the nine listed companies of Adani Group witnessed a decline of around 60 per cent of market capitalisation from January 24, 2023, till March 01, 2023 subsequent to the report published by Hindenburg Research. “The volatility in the stocks of these companies has not had any significant impact at the systemic level. Nifty 50 declined by around 4.5 per cent during the same period,” he said.
Also read: LIC’s debt exposure to Adani Group dips marginally
Hindenburg had, in January, made a litany of allegations, including fraudulent transactions and share-price manipulation, against Adani Group, following which shares of the Group had taken a beating. The Group has dismissed the charges as lies, saying it complies with all laws and disclosure requirements.
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Chaudhary further said that as a regulator of securities markets, SEBI is mandated to put in place regulatory frameworks for effecting stable operations and development of the securities markets, including the protection of investors. “As per its mandate, it investigates into any alleged violations of its Regulations by any market entity. It is, accordingly, undertaking investigation into the market allegations against the Adani Group of companies,” he said.
Also read: Adani Group stocks: Buyers high on speculation, low on conviction
In a separate reply, Chaudhary said these listed Adani Group companies have a combined weight of below 1 per cent in Nifty. “Nifty 50 declined by around 2.9 per cent in the month of January 2023 and by around 4.9 per cent in the 2-month period of January and February 2023,” the minister said.
He said the pricing of individual stocks and variations, over or undervaluation, and the price risks borne by investors are determined by the dynamics of demand and supply. The regulatory framework provides for surveillance mechanisms, which are triggered in instances of volatility in share prices of specific companies, Chaudhary said.
In its order dated March 2, 2023, the Supreme Court has directed SEBI to conclude the ongoing investigations within two months.
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