Hindenburg Report: MSCI Seeks Response On Adani Group After ‘accounting Fraud’ Allegations
February 2023: Index provider MSCI has said it is closely monitoring publicly available information regarding allegations of serious fraud leveled against Adani group companies and is also seeking feedback from market participants on these issues.
Recently, a report by US-based investment research firm Hindenburg alleged that the Adani group of companies was involved in stock manipulation and accounting fraud.
MSCI said it is aware of the recently published reports on Adani Group and related securities.
“MSCI is closely monitoring publicly available information regarding conditions and factors that may affect the eligibility of the relevant securities for the MSCI Global Investable Market Index,” it said in a statement.
Currently, there are eight Adani Group and associate companies that feature on the MSCI Standard Index.
Market experts believe that any adverse reaction could result in a weightage reduction or exclusion of Adani’s shares from the MSCI index.
This could add to the selling pressure in Adani Group shares, which have taken a beating over the past two trading sessions and the combined market valuation of the listed companies has risen by Rs. 4.17 lakh crore had been lost, they said. Market experts believe that MSCI will not take any action until the feedback process is completed.
The Adani Group’s flagship company, Adani Enterprises, has invested Rs. The Hindenburg report was released before the Rs 20,000 crore share offer was launched to investors. The disclosure led to a massive sell-off in Adani Group shares on the stock exchange.
The FPO opened on January 27 will end on January 31.
Responding to the allegations leveled by Hindenburg, the Adani Group said it was shocked to see the report come out without any attempt to contact it to get factual metrics.
The group said it was exploring legal options to take “punitive action” against Hindenburg Research for its “reckless” attempt to sabotage a mega share sale at the group’s flagship firm – a statement that the US The activist investor responded by saying he was following up on her report. It alleged “brazen” market manipulation and accounting fraud by the group.
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