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India’s Supreme Court has ruled against escalating an investigation into Gautam Adani’s conglomerate, which would have transferred it to a special investigative unit, in a decision welcomed by the billionaire businessman as he looks to move past short-seller allegations of fraud.
A Supreme Court bench led by chief justice Dhananjaya Chandrachud said there were no grounds to transfer a probe by India’s markets regulator to another law enforcement agency, according to local media reports.
The court gave the Securities and Exchange Board of India three months to complete multiple long-running investigations into the Adani Group, which US short seller Hindenburg Research last January accused of “pulling the largest con in corporate history”. Adani denies Hindenburg’s allegations.
Share prices of Adani’s listed companies rose slightly following the order on Wednesday, extending a rally that has helped them to recover about half the market value they lost following Hindenburg’s allegations.
Gautam Adani, the group’s founder, responded to the ruling by saying that “truth has prevailed”.
“I am grateful to those who stood by us,” he wrote in a post on X. “Our humble contribution to India’s growth story will continue.”
The allegations against the Adani Group — whose businesses range from ports and power to commodity trading — became one of the biggest corporate and political scandals in India last year, at one point wiping as much as $150bn off the market capitalisation of the group’s listed companies.
India’s opposition has sought to turn accusations of wrongdoing against Adani, one of the country’s most politically powerful businesspeople with longstanding ties to Prime Minister Narendra Modi, into a campaign issue ahead of an upcoming general election.
But shares in companies such as Adani Enterprises and Adani Ports have on average risen about a third since November, partly on the expectation that Sebi’s probes were approaching an end.
The group received a separate boost in November after the US government said it was lending more than $500mn to an Adani-led port development project in Sri Lanka. It has also pared down its debt levels in the aftermath of the allegations.
But Sharmila Gopinath, a specialist adviser for India at the Asian Corporate Governance Association, argued that regulatory scrutiny of the group was not over.
“What they have gone and said is that the regulator needs to do its job, they need to finish what they have started,” she said of the court ruling.
“The Supreme Court should not step on the regulator’s toes until the regulator has finished its investigations,” she added. “Whether anybody can approach the Supreme Court post the investigations being tied up, that’s another question altogether.”
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