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Adani Stocks Shine in Market Rally
In a recent turn of events, Adani Group stocks experienced a significant surge following a Supreme Court decision regarding the Hindenburg probe. Adani Energy Solutions led the charge with a remarkable 17.83% gain, followed by NDTV at 11.39%, Adani Total Gas at 9.99%, Adani Green Energy at 9.13%, and Adani Enterprises at 9.11% on the BSE.
Supreme Court Ruling on Hindenburg Probe and Market Impact
The Supreme Court, in response to allegations made by US-based short seller Hindenburg group against the Adani Group, ruled that there was no grounds to order an investigation by a Special Investigation Team (SIT) or other probe agency. The three-judge bench, presided by Chief Justice of India D Y Chandrachud, emphasized that the Securities and Exchange Board of India (SEBI) had completed investigations in 20 out of the 22 matters related to the allegations against the Adani Group.
SEBI’s Progress and Court’s Directive
The court directed that the probe into the remaining two pending cases be completed expeditiously, ideally within the next three months. The positive outlook on Adani Group stocks stems from the Supreme Court’s assertion that the facts of the case did not warrant a transfer of the investigation from SEBI.
Rejection of Conflict of Interest Allegations
Supreme Court Ruling on Hindenburg Probe: The Supreme Court also dismissed allegations of conflict of interest against some members of its expert committee, deeming them “unsubstantiated.” The court clarified that the power to transfer an investigation is exercised only in extraordinary cases where glaring, willful, and deliberate inaction by the competent authority is evident. In this case, the court asserted that the threshold for transfer had not been met.
Discrediting Third-Party Reports
Furthermore, the court rejected reliance on a report by the Organized Crime and Corruption Reporting Project (OCCRP) that suggested SEBI’s lackadaisical conduct in the investigation. The court highlighted that a third-party report without an attempt to verify the authenticity of its allegations cannot be considered conclusive proof.
Background: Hindenburg Report and OCCRP Allegations
The Hindenburg report, released in January of the previous year, accused the Adani Group of “brazen stock manipulation and accounting fraud scheme over the course of decades.” Subsequently, the OCCRP made additional allegations of stock manipulation against the group in September, citing ties between supposedly public investors and the Adani family.
Market Trends Amidst Adani Rally
Despite the surge in Adani Group stocks, the broader market faced a downturn. The 30-share BSE Sensex traded 319.47 points lower at 71,544.60, and the Nifty quoted 104.30 points down at 21,561.50. Notably, Adani Ports and Ambuja Cements reached their 52-week high levels during morning trade.
Market Decline: Sensex and Nifty Numbers
On a broader scale, the stock market faced declines for the second consecutive day. The Sensex closed lower by 535 points at 71,356.60, and the Nifty slipped by 148.45 points to 21,517.35. Key contributors to this decline included JSW Steel, Tata Steel, Tech Mahindra, Infosys, Wipro, Tata Consultancy Services, Nestle, HCL Technologies, HDFC Bank, and Maruti.
In conclusion, the recent rally in Adani Group stocks showcases the market’s positive response to the Supreme Court’s decision, bringing a sense of relief to investors. The court’s directive for the swift completion of pending investigations further adds to the overall optimism surrounding Adani Group stocks. However, amidst this, the broader market faces its own set of challenges and fluctuations.
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