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Hindenburg Report

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What is Hindenburg Report?

On January 24, a US-based investment research firm named Hindenburg Research published a report on the Adani Group, revealing the findings of their two-year investigation. The report titled 'Adani Group: How The World’s 3rd Richest Man Is Pulling The Largest Con In Corporate History' made many allegations against the conglomerate, saying that the group has been involved 'in a brazen stock manipulation and accounting fraud scheme over the course of decades.' 
 
The report came two days before a $2.5 billion follow-up public offering was issued by Adani Enterprises.
 

What is Hindenburg Research?
Hindenburg Research specialises in forensic financial research, and has decades of experience in the investment management industry, the company says in its website. The firm says it focuses on "equity, credit, and derivatives analysis." The research company has short positions in Adani Group's firms through US-traded bonds and non-Indian-traded derivative instruments.
 
What are the allegations made by Hindenburg Research against the Adani Group?
The Hindenburg report said that the Adani Group's chairman Gautam Adani has added more than $100 billion in the past three years, largely through "stock price appreciation in the group’s 7 key listed companies, which have spiked an average of 819% in that period."
 
Key listed Adani firms have taken on "substantial debt, including pledging shares of their inflated stock for loans, putting the entire group on precarious financial footing," the report said. The research firm said that five out of seven key listed Adani companies have "reported ‘current ratios’ below 1, indicating near-term liquidity pressure."
 
The Hindenburg report said that Rajesh Adani, Gautam Adani’s younger brother, was accused by the Directorate of Revenue Intelligence (DRI) of playing a central role in a diamond trading scheme that involved the use of offshore shell firms to generate artificial turnover in 2004-2005. "Rajesh was arrested at least twice over separate allegations of forgery and tax fraud. He was subsequently promoted to serve as Managing Director of Adani Group," the report added.
 
The research firm said that Adani's elder brother, Vinod Adani, has been described as 'an elusive figure' by media as he has regularly been found at the centre "of the government’s investigations into Adani for his alleged role in managing a network of offshore entities used to facilitate fraud."
 
Through several close associates, Vinod Adani "manages a vast labyrinth of offshore shell entities," the research firm stated, adding that they found "38 Mauritius shell entities controlled by Vinod Adani or close associates."
 
The Hindenburg report added that the shell firms operated by Vinod Adani "seem to serve several functions, including (1) stock parking / stock manipulation (2) and laundering money through Adani’s private companies onto the listed companies’ balance sheets in order to maintain the appearance of financial health and solvency."
 
A right to information (RTI) filed with Sebi by the Hindenburg revealed that "offshore funds are the subjects of an ongoing investigation, more than a year-and-a-half after concerns were initially raised by media and members of parliament."
 
"We believe the Adani Group has been able to operate a large, flagrant fraud in broad daylight in large part because investors, journalists, citizens and even politicians have been afraid to speak out for fear of reprisal," the research firm said.
 
The report included 88 questions at the conclusion and said, "If Gautam Adani truly embraces transparency, as he claims, they should be easy questions to answer."
 
To read the full report by Hindenberg Research, click here

Latest Updates on Hindenburg Report

The petitioner has also called for the conclusive report by the Securities and Exchange Board of India (Sebi) on the probe carried out till now

Updated On: 24 Nov 2024 | 11:37 PM IST

She also said that it would have been better if the Centre had ordered a high-level inquiry into the matter by now

Updated On: 13 Aug 2024 | 12:34 PM IST

Explained: What is Hindenburg Research, what is short-selling and how much profit did the US firm make on its 2023 Adani Group report

Updated On: 12 Aug 2024 | 1:15 PM IST

Hindenburg Research was founded in 2017 by Nathan Anderson

Updated On: 12 Aug 2024 | 1:52 PM IST

All you need to know before market opens on Monday: GIFT Nifty hints at a marginal dip in the aftermath of Hindenburg attack; FIIs remain net long in index futures; 15 stocks in F&O ban period today.

Updated On: 12 Aug 2024 | 7:28 AM IST

Regulator asks investors to exercise due diligence before reacting to reports

Updated On: 11 Aug 2024 | 10:30 PM IST

Amidst allegations from Hindenburg, the couple stated that they never had exposure to Adani firms

Updated On: 11 Aug 2024 | 5:10 PM IST

Says fund in which the Buchs invested focused on debt, maintains no investor had any role in its ops

Updated On: 11 Aug 2024 | 11:24 PM IST

Opposition parties claimed govt cut short Budget session to avoid questions on the issue

Updated On: 11 Aug 2024 | 10:26 PM IST

Custodians say investment in Adani-linked offshore fund could be a case of bad luck

Updated On: 11 Aug 2024 | 3:16 PM IST

A decade ago, Sebi approved a long-pending proposal to introduce REITs in India, creating a new investment avenue for institutional investors, wealthy individuals, and eventually ordinary investors

Updated On: 11 Aug 2024 | 6:34 PM IST

Addressing a press conference here, AAP Rajya Sabha MP Sanjay Singh said the Sebi had told a Supreme Court panel that the investigation into the Adani group was directionless

Updated On: 11 Aug 2024 | 1:17 PM IST

The Sebi chief has 'strongly' denied Hindenburg's fresh allegations terming it 'baseless insinuations' which is 'devoid of any truth'

Updated On: 11 Aug 2024 | 1:00 PM IST

In a statement to the stock exchanges on Sunday, an Adani group spokesperson said the latest allegations by Hindenburg are malicious, mischievous, and manipulative

Updated On: 11 Aug 2024 | 7:07 PM IST

Analysts believe that these statements are mere allegations, which, at best, can trigger a knee-jerk reaction in the markets when they open for trade on Monday

Updated On: 11 Aug 2024 | 5:15 PM IST

Short-seller says whistleblower documents have revealed Sebi Chairperson Madhabi Puri Buch had stake in obscure offshore entities used in Adani money siphoning scandal; Buch terms allegations baseless

Updated On: 12 Aug 2024 | 10:05 AM IST

The short seller alleges 'surreptitious aid' to Adani Group by Sebi

Updated On: 02 Jul 2024 | 2:44 PM IST

Lawyer says matter is 'question mark upon regulatory mechanism', wants Sebi to submit report on US shortseller's allegations against Adani Group

Updated On: 07 Jun 2024 | 6:57 PM IST

The flagship's stock rose 1.7% to 3,445.05 in Mumbai on Friday and has now almost tripled since its nadir in February 2023

Updated On: 24 May 2024 | 11:29 AM IST

The foreign currency loan could range from seven to ten years, with the pricing likely linked to the Secured Overnight Financing Rate, said the people, who asked not to be named

Updated On: 09 Apr 2024 | 2:45 PM IST