Ajit Karn
In the past week, the Securities and Exchange Board of India (SEBI) noted “unusual price movement in a business conglomerate’s stocks” in response to the Adani stock decline.
“SEBI is committed to ensuring market integrity and ensuring that the markets continue to function in an uninterrupted, transparent, and efficient manner,” SEBI said in a statement today.
The share prices of Adani group companies declined further on Friday due to continued selling pressure and concerns about the potential systemic impact of disarray triggered by a report critical of the group’s finances.
“In the past week, unusual price fluctuations in a business conglomerate’s stock have been observed. As part of its mandate, SEBI seeks to maintain the orderly and efficient functioning of the market and has implemented a series of well-defined, publicly available surveillance measures (including the ASM framework) to address excessive volatility in particular stocks “The SEBI stated in its statement. It failed to mention Adani group.
The regulator stated, “This mechanism is automatically activated under certain conditions of price volatility in any stock.”
The SEBI statement was released a day after the Reserve Bank of India (RBI) stated that the country’s banking system remains resilient and stable, despite concerns regarding the exposure of lenders to Adani group companies.
After US short-seller Hindenburg Research raised allegations about high debt levels and use of tax havens, the market value of Adani group firms’ shares decreased by more than fifty percent, or more than $100 billion.
The ports-to-energy conglomerate, led by one of the world’s wealthiest men, Gautam Adani, dismissed the criticism and denied wrongdoing. Adani group stated in a 413-page response that the Hindenburg report was motivated by “an ulterior motive” to “create a false market” that would allow the U.S. company to profit.
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Additionally, Adani Enterprises Ltd cancelled its 20,000 crore follow-on share sale one day after it was fully subscribed. Adani stated that the company’s board of directors felt that “proceeding with the issue would not be morally correct” in light of the market turmoil.
