Bad news for Gautam Adani as SEBI accuses nephew Pranav Adani of…, says he earned profit by…
In more troublesome news for billionaire Gautami Adani-led Adani Group, SEBI has accused his nephew, Pranav Adani, of indulging in insider trading and sharing sensitive/confidential information that breached regulations put in place by the markets regulator.
Adani nephew accused of insider trading
According to a Reuters report, the Securities and Exchange Board of India (SEBI) had sent a notice to Pranav Adani last year, in which the regulator had accused him of sharing confidential information about Adani Green’s 2021 acquisition of SoftBank-backed SB Energy Holdings with his brother-in-law, Kunal Shah and his brother Nrupal Shah, before the deal was announced.
The report, citing a SEBI document, Pranav Adani, the nephew of Gautam Adani “communicated UPSI (unpublished price sensitive information) pertaining to the SB Energy acquisition” to his brother-in-law Kunal Shah and violated norms related to insider trading rules in 2021.
The document also showed call records and trading patterns were reviewed in the investigation, it said.
Shah brothers made ‘ill-gotten’ gains
On May 17, 2021, Adani Green acquired SB energy for a staggering $3.5 billion, making it the largest acquisition in India’s renewable energy sector. After finding out the impending acquisition a few days before the deal was finalised on May 16, 2021, SEBI shared the confidential info with the Shah brothers, who used the details to trade in Adani Green shares, and made “ill-gotten gains” worth Rs 90 lakh ($108,000), the report said, citing an anonymous source.
In a statement issued by their lawyers, the Shah brothers denied the accusation, claiming that trades were not conducted with “knowledge of any unpublished price sensitive information nor with any mala fide intent”, as the “information in question was already generally available in the public domain”.
Pranav Adani refutes allegations
Queried about the SEBI charges, Pranav Adani refuted the allegation, and told Reuters in an emailed response that 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”.
The report, citing a source with direct knowledge of the matter, said that settlement terms between Adani’s nephew and SEBI were being discussed. The regulator had also proposed settlement to Kunal and Nrupal Shah, but the brothers turned down the offer, and chose to contest the allegations as they found the terms too onerous, the report added.
The SEBI allegation is the latest in the long list of challenges faced by the Adani Group. Last year. US authorities last had indicted Gautam Adani and two Adani Green executives, including another Adani nephew, Sagar Adani, for allegedly paying bribes to secure Indian power supply contracts and misleading US investor.
The Adani Group has vehemently refuted the charges as “baseless”, and vowed to fight them in US courts.
(With inputs from agencies)
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