Background
- The Securities and Exchange Board of India (SEBI) is probing 13 offshore investors in the Adani Group following Hindenburg Research’s 2023 allegations.
- Allegations involved use of tax havens and stock manipulation, which triggered a massive stock selloff.
- The Adani Group has denied any wrongdoing, and stock prices have largely recovered since.
Warning Issued to Mauritius-Based Funds
- SEBI has threatened action against two Mauritius-based foreign portfolio investors (FPIs):
- Elara India Opportunities Fund
- Vespera Fund
- Reason: Failure to disclose granular shareholder details despite repeated requests since 2023.
Nature of Violations and Concerns
- The two FPIs held concentrated stakes in Adani Group firms.
- They did not provide details of their beneficial owners or justify the non-disclosure.
- SEBI stated that this lack of transparency hinders its investigation into:
- Minimum Public Shareholding (MPS) compliance
- Ownership concentration norms
Possible Consequences
- Penalties
- Cancellation of FPI licences
- Further regulatory tightening on foreign funds operating from tax-friendly jurisdictions
BS
