Thread by @BeatTheStreet10

Whether Adani is eligible for raising money via FPO

Rule says you cannot if SEBI investigation is ongoing

A detailed thread on the eligibility test of Adani Enterprises FPO

#AdaniFPO #AdaniGroup #AdaniEnterprises #ADANIENT

The law

As per regulation 155 of SEBI ICDR Regulations company cannot bring the FPO if investigation by sebi is ongoing or show cause notice has been served and pending

Backstory,In July-21 Govt in parliament responded to questions raised by @MahuaMoitra and stated that SEBI is investigating Adani Group

moneylife.in/article/sebi-d…

Same day, Adani group clarified that there is no investigation ongoing by Sebi, though theybmentioned that Sebi has sought some "specific information" (more details on this later)

A month after parliamentary response, Sebi kept Adani Wilmar IPO "in abeyance" without giving further details.

Most probably due to Sebi ongoing investigation which Govt mentioned

m.economictimes.com/markets/ipos/f…

Adani Group in RHP documents (Adani Wilmar IPO and Adani Enterprises IPO) didn't disclose about any such investigation which govt mentioned

But stated that Sebi sought some information in Nov-20 and it responded but no show cause notice or further communication issued

Also interesting to note is how the description of "specific information" sought by Investigation dept of Sebi has changed in both (Adani Wilmar vs Adani Ent) has changed

Pic 1 : Adani Ent
Pic 2 : Adani Wimar (highlighted in red the missing information in FPO doc)

To give perspective on timing,
Sebi sought information from Adani Group in Nov-20 (before @suchetadalal 's tweet on Adani Group) while Govt response came after her tweet

Fast forward to 2023, @HindenburgRes says SEBI investigation is ongoing and not concluded as of Sept-22

@Reuters @jaysh88 also mentioned that Sebi investigation is ongoing

Summarizing there are evidences that investigation is ongoing but Adani group has denied it.

If investigation is ongoing Adani Enterprises is no eligible for Fast Track FPO route

Sebi needs to clarify

1. Whether investigation is ongoing or not?
2. What actions Sebi took after taking information from Adani in Nov-20?
3. Clarify on scope & person involved in investigation mentioned by Govt
4. Whether there investigation is on Adani or its FPIs?
Cont

Cont
5. Whether Adani Enterprises suffice the pre conditions of Fast track FPO as mentioned in reg 155 of ICDR?

Interestingly fast track route of FPO doesn't need Sebi nod.

End