Nathan Anderson, founder of short-seller Hindenburg Research and Gautam Adani, founder of Adani Group.
Nathan Anderson, founder of short-seller Hindenburg Research and Gautam Adani, chairman of Adani Group. Image Credit: Washington Post | Bloomberg

New Delhi: India's Supreme Court ordered the market regulator to conclude its investigation into the Adani Group within three months and said no more probes were needed, potentially drawing a line under the year-long saga triggered by a short-seller attack on the Indian conglomerate.

The three-judge bench, headed by the Chief Justice of India D. Y. Chandrachud, on Wednesday asked the local markets regulator, Securities and Exchange Board of India, or Sebi, to close its pending investigation and asked the federal government to implement recommendations from an expert panel to bolster the regulatory framework.

Shares of 10-listed Adani Group companies pared some of their initial gains following the verdict with Adani Enterprises' shares up 3.6 per cent in Mumbai trading. The flagship unit's stock had risen 9.1 per cent during the day to its highest level in more than 11 months.

The ruling from India's apex court comes as a reprieve after nearly a year of intense scrutiny for billionaire Gautam Adani despite his ports-to-power conglomerate repeatedly denying Hindenburg Research's allegations of corporate malfeasance, stock price manipulations and related party transactions among others in a bombshell report.

Massive Rout

The short-seller's broadside last January triggered a massive rout in Adani stocks and stocks, wiping out more than $150 billion in equity market value at one point. It also forced the Indian conglomerate into months of damage control that included paying down debts, assuaging investor concerns through road shows across the world's financial hubs and scaling back non-essential businesses.

India's top court in March ordered Sebi to probe Hindenburg's allegations. It also set up a six-member expert panel to assess if there were any regulatory lapses. The panel said in May that no regulatory failures could be concluded nor was there any conclusive evidence of stock-price manipulation by the conglomerate.

The verdict comes as the Adani Group continues to regain investor and lender confidence. The conglomerate in recent months has secured investments from GQG Partners Inc. and Middle-Eastern sovereign wealth funds, funding from a US government agency, refinanced a $3.5 billion loan and pledged $100 billion in green transition.