SEBI Clears Adani, Quashes Hindenburg Allegations
By A Draft Correspondent
When the Securities and Exchange Board of India (SEBI) handed a clean chit to the Adani Group, it wasn’t just the closure of a high-profile probe; it was the culmination of a narrative that had all the ingredients of a financial thriller - foreign intrigue, corporate ambition, political insinuations and, above all, the delicate balance between perception and proof.
On 24 January 2023, Hindenburg Research, a little-known US-based short-seller, dropped a 100-page report that landed like a bomb on Dalal Street.
 |
| Image for representational purpose only |
It accused Adani Group companies of stock manipulation, opaque structures, and debt overreach. The timing was surgical, just days before Adani Enterprises’ ₹20,000-crore follow-on public offer (FPO).
Markets went into a tailspin. Retail investors panicked, institutional investors froze, and Adani’s market capitalisation evaporated by over $100 billion in a matter of weeks. In political circles, the allegations were seized upon with unrestrained glee.
For the Opposition, the report became shorthand for crony capitalism and proof that India’s economy was being hijacked by a handful of favoured conglomerates.
Unlike the sensationalism of television studios or the celebratory tone of political rivals, SEBI’s approach was methodical, bordering on glacial. It began collecting disclosures, examining offshore structures, and tracing fund flows.
The Supreme Court, sensing the high-voltage fallout, even set up an expert committee to oversee aspects of the probe, adding another layer of scrutiny.
Through this period, the Adani Group held its ground. Projects continued, global investors were courted, and the company repeatedly denied wrongdoing.
But the shadow of Hindenburg loomed large. For investors, uncertainty was more damaging than any allegation.
When SEBI finally declared there was no sustainable evidence of manipulation or systemic irregularities, the impact was immediate. Stocks steadied, investor confidence returned, and the narrative shifted from accusation to vindication.
But the significance of SEBI’s finding goes far beyond one corporate group. By asserting its authority, the regulator sent a message that Indian markets would not be dictated by the agenda of overseas short-sellers, however damning their claims or dramatic their timing.
Here lies the rub. Even as SEBI’s conclusion rests on hard evidence, or the lack thereof, the politics of perception refuses to yield.
Opposition parties will continue to weaponise the Hindenburg episode as symbolic of government-corporate collusion. International critics will frame SEBI’s clearance as protectionism.
Yet, in the larger scheme, perception can only do so much. Markets ultimately answer to numbers.
If Adani continues to attract capital, secure contracts, and deliver infrastructure at scale, the Hindenburg allegations will fade into history as just another speculative storm.
This episode, however, exposes a structural dilemma: where does vigilance end and protectionism begin?
For an economy as ambitious as India’s, hungry for foreign investment yet wary of external narratives, striking this balance is critical. Over-regulation risks choking entrepreneurship; under-regulation risks creating distrust.
SEBI’s clearance, then, is not just an exoneration of Adani but a reminder that India’s regulatory institutions must constantly walk this tightrope, resisting both populist pressures and foreign provocations.
For now, the market itself will be the ultimate arbiter. If Adani stocks recover robustly, if overseas investors increase their stakes, and if infrastructure projects—from ports to power plants—continue to roll out, SEBI’s clearance will have been vindicated not in press releases but in economic reality.
For critics, the Hindenburg report will remain a political tool. For investors, it will remain a cautionary tale. But for the Indian regulatory state, this episode will be remembered as proof that while allegations can rattle, only due process can decide.
And in India’s high-voltage political economy, it is clearance—not controversy—that ultimately counts.
To receive regular updates and notifications, follow The Draft News:
