American firm Hindenburg alleges ‘brazen fraud’ by Adani Group; ‘malafide intention’ to damage upcoming FPO, alleges company

January 25, 2023 08:44 pm | Updated January 26, 2023 10:44 am IST

Well-known US activist investor Hindenburg Research has alleged that Adani Group was “engaged in a brazen stock manipulation and accounting fraud”, a charge the conglomerate described as malicious, unsubstantiated, one-sided, and having done with malafide intention to ruin its share-sale, PTI reported.

Hindenburg, a US-based investment research firm that specialises in activist short-selling, said its two-year investigation reveals that “the ₹17.8 trillion (US$ 218 billion) Indian conglomerate Adani Group has engaged in a brazen stock manipulation and accounting fraud scheme over the course of decades.” The report comes ahead of a ₹20,000 crore follow-on share sale of Adani Group’s flagship Adani Enterprises. The follow-on public offer (FPO) is slated to open on January 27 and close on January 31.

Adani Group said it was shocked to see the report that came out without any attempt to contact it to get the factual matrix. “The report is a malicious combination of selective misinformation and stale, baseless and discredited allegations that have been tested and rejected by India’s highest courts,” the ports-to-energy conglomerate said in a statement.

It went on to question the timing of the report, saying its publication ahead of the FPO “clearly betrays a brazen, malafide intention to undermine Adani Group’s reputation with the principal objective of damaging” the issue.

Adani Group stocks fell after the report but recouped some of the losses. Adani Enterprises fell 2.5% but pared some losses after the statement to trade at 1.5% lower at 1350 hrs. Adani Ports & SEZ Ltd, which was down 6.23% at noon, too recovered some grounds and was down 5.1% at 1350 hrs.

“Gautam Adani, founder and chairman of Adani Group, has amassed a net worth of roughly USD 120 billion, adding over USD 100 billion in the past 3 years largely through stock price appreciation in the group’s seven key listed companies, which have spiked an average of 819% in that period,” the US researcher’s report said.

The Hindenburg’s report details a web of Adani-family controlled offshore shell entities in tax havens spanning the Caribbean and Mauritius to the United Arab Emirates, which it claims were used to facilitate corruption, money laundering and taxpayer theft, while siphoning off money from the group’s listed companies. “Our research involved speaking with dozens of individuals, including former senior executives of Adani Group, reviewing thousands of documents, and conducting diligence site visits in almost half a dozen countries,” it said.

India, Pakistan came close to a nuclear war, claims former U.S. Secretary of State in new book

Former U.S. Secretary of State Mike Pompeo has claimed that he was “awakened” to speak to his then Indian counterpart Sushma Swaraj who told him that Pakistan was preparing for a nuclear attack after the Balakot surgical strike in February 2019 and India is preparing its own escalatory response.

In his latest book Never Give an Inch: Fighting for the America I Love that hit the stores on Tuesday, Pompeo says the incident took place when he was in Hanoi for the U.S.-North Korea Summit on February 27-28 and his team worked overnight with both New Delhi and Islamabad to avert this crisis.

“I do not think the world properly knows just how close the India-Pakistan rivalry came to spilling over into a nuclear conflagration in February 2019. The truth is, I don’t know precisely the answer either; I just know it was too close,” he writes.

India’s warplanes pounded a Jaish-e-Mohammed terrorist training camp at Balakot in Pakistan in February 2019 in response to the Pulwama terror attack that killed 40 CRPF jawans.

“I’ll never forget the night I was in Hanoi, Vietnam when — as if negotiating with the North Koreans on nuclear weapons wasn’t enough — India and Pakistan started threatening each other in connection with a decades-long dispute over the northern border region of Kashmir,” Pompeo says.

“After an Islamist terrorist attack in Kashmir -- probably enabled in part by Pakistan’s lax counterterror policies -- killed forty Indians, India responded with an air strike against terrorists inside Pakistan. The Pakistanis shot down a plane in a subsequent dogfight and kept the Indian pilot prisoner,” he said.

“In Hanoi, I was awakened to speak with my Indian counterpart. He [referring to Swaraj] believed the Pakistanis had begun to prepare their nuclear weapons for a strike. India, he informed me, was contemplating its own escalation. I asked him to do nothing and give us a minute to sort things out (sic),” Pompeo writes in his book.

“I began to work with Ambassador (then National Security Adviser John) Bolton, who was with me in the tiny secure communications facility in our hotel. I reached the actual leader of Pakistan, (Army chief) General (Qamar Javed) Bajwa, with whom I had engaged many times. I told him what the Indians had told me. He said it wasn’t true,” Pompeo says.

“As one might expect, he believed the Indians were preparing their nuclear weapons for deployment. It took us a few hours — and remarkably good work by our teams on the ground in New Delhi and Islamabad — to convince each side that the other was not preparing for nuclear war,” the 59-year-old top former American diplomat writes in his book. There was no immediate comment from the Ministry of External Affairs on Pompeo’s claims.

Lakhimpur Kheri case: SC grants Ashish Mishra interim bail ‘initially’ for eight weeks

The Supreme Court on January 25 granted interim bail for eight weeks to Ashish Mishra, the prime accused in the Lakhimpur Kheri killings and son of Union Minister of State for Home Affairs Ajay Kumar Mishra, even as it described the crime as “ghastly” and “unfortunate”.

The court used its suo motu powers to similarly grant interim bail to four under-trial prisoners accused of lynching three men during the violence that broke out immediately after an SUV allegedly belonging to Mishra’s convoy mowed down farmers protesting controversial agricultural laws in a rally at Lakhimpur Kheri district in Uttar Pradesh on October 3, 2021.

The FIR registered against these four accused—Gurvinder Singh, Vichitra Singh, Ranjit Singh and Avtar Singh—is seen as a “counter case” filed by the Uttar Pradesh Police to provide a “diametrically opposite” narrative to that of the main murder case against Mishra.

A Bench of Justices Surya Kant and JK Maheswari took suo motu cognisance of the “state” of the four under-trials, calling them “poor farmers”.

The order to release the four men on interim bail is despite the fact that their bail applications are actually pending before the Allahabad High Court. The fate of these four men had however come up for discussion during the hearing of Mishra’s bail on January 19, when the case was reserved for orders. The court had reasoned that a refusal to grant “some relief” to the son of Union Minister of State for Home Affairs Ajay Kumar Mishra may have a ripple-effect on the four under-trials languishing in jail, and they may not get bail “for all time to come”.

Pronouncing the order for the Bench, Justice Kant directed that Mishra, instead of getting regular bail, should be released on interim bail initially for eight weeks.

Mishra was directed to leave Uttar Pradesh within a week so that he posed no danger to witnesses waiting to testify against him in the main murder case. He has also been banned from entering Uttar Pradesh during the eight-week period of his interim bail. The court further said he should neither stay in Delhi or Uttar Pradesh.

The court said the interim bail and conditions imposed on Mishra was a balancing of the right of the accused to liberty, the right of the State to conduct a fair trial and the right of the victims to get justice. The Bench ordered Mishra to inform the trial court about his place of residence and surrender his passport before it.

Mishra was directed to mark his presence at the local police station of his place of residence.

The court said he would be present at every date of hearing and seek no adjournments. Any attempt on his part to prolong the trial would result in the cancellation of his bail.

The court refrained from entering into the merits of the main case and the counter case against the four farmers, except to say that only a “scrupulous” trial into the “diametrically opposite” narratives would unravel the real truth.

Senior advocate Dushyant Dave, for the victims, had said four farmers and a journalist were “slaughtered consciously by the son of a powerful man, who himself should have been made an accused in the case for making incendiary remarks in public platforms against protesting farmers just days before the Lakhimpur Kheri incident”.

“A heinous crime has been committed. The Supreme Court had constituted a Special Investigation Team in this case. This is cold-blooded murder and not a case of rash driving. The time an accused spends in jail is not a consideration while examining the question of bail in a heinous crime,” Dave had submitted.

The Allahabad High Court had earlier rejected Mishra’s bail application. Senior advocates Mukul Rohatgi and Siddharth Dave, for Mishra, said it was not a case of murder and a “melee” had happened in which even people in the car which allegedly ran over the victims had got killed. Mishra had already been incarcerated for a year, they had argued.

Germany finally agrees to provide Ukraine with Leopard tanks, Russia warns of ‘historical responsibility’

After weeks of hesitation that saw growing impatience among Germany’s allies, Chancellor Olaf Scholz announced Wednesday that his government would provide Ukraine with Leopard 2 battle tanks and approve requests by other countries to do the same.

In a statement, the government said it would initially provide Ukraine with one company of Leopard 2 A6 tanks, which comprises 14 vehicles, from its own stocks. The goal is for Germany and its allies to provide Ukraine with a total of two battalions, or 88 tanks.

Scholz said Germany was “acting in close coordination” with its allies. The long-awaited decision came after U.S. officials said a preliminary agreement had been struck for the United States to send M1 Abrams tanks to help Kyiv push back Russian forces entrenched in the east almost a year since the start of the war. Scholz had insisted that any move to provide Ukraine with powerful Leopard 2 tanks would need to be closely coordinated with Germany’s allies, chiefly the United States.

By getting Washington to commit some of its own tanks Berlin hopes to spread the risk of any backlash from Russia. Ekkehard Brose, head of the German military’s Federal Academy for Security Policy, said tying the United States into the decision was crucial, to avoid Europe facing a nuclear-armed Russia alone.

But he also noted the deeper historic significance of the decision. “German-made tanks will face off against Russian tanks in Ukraine once more,” he said, adding that this was “not an easy thought” for Germany, which takes its responsibility for the horrors of World War II seriously.

“And yet it is the right decision,” Brose said, arguing that it was up to Western democracies to help Ukraine stop Russia’s military campaign. Kremlin spokesman Dmitry Peskov described German and U.S. intentions with the tanks as a “a rather disastrous plan”.

“I am convinced that many specialists understand the absurdity of this idea,” Peskov told reporters Wednesday.

“Simply because of technological aspects, this is a rather disastrous plan. The main thing is, this is a completely obvious overestimation of the potential (the supply of tanks) would add to the armed forces of Ukraine. It is yet another fallacy, a rather profound one,” the Kremlin official said.

Peskov predicted “these tanks will burn down just like all the other ones.... Except they cost a lot, and this will fall on the shoulders of European taxpayers.” he added.

The Russian embassy in Germany said that Berlin was abandoning its “historical responsibility to Russia” arising from Nazi crimes in World War II. In a scathing statement, the embassy said that the tank deliveries would escalate the conflict to a new level and lead to “permanent escalation”.

This extremely dangerous decision takes the conflict to a new level of confrontation and contradicts the statements of German politicians about the unwillingness of the Federal Republic of Germany to be drawn into it,” Ambassador Sergei Nechayev said.

“It destroys the remnants of mutual trust, causes irreparable damage to the already deplorable state of Russian-German relations, and casts doubt on the possibility of their normalisation in the foreseeable future,” he added.

Members of Scholz’s three-party coalition government welcomed the news ahead of the official announcement. “The Leopard’s freed!” said German lawmaker Katrin Goering-Eckardt, a senior Green party lawmaker.

Marie-Agnes Strack-Zimmermann, a member of the Free Democratic Party who chairs the parliamentary defence committee, said the news was “a relief for a mistreated and brave Ukraine”.

“The decision to approve (other countries’ requests) and supply the Leopard 2 was arduous, but unavoidable,” she said. Strack-Zimmermann had been one of the loudest voices calling for a swift decision on arms supplies to Ukraine.

ED arrests Trinamool Congress spokesperson Saket Gokhale in money laundering case

The Enforcement Directorate has arrested Trinamool Congress (TMC) spokesperson Saket Gokhale in a money laundering case linked to alleged irregularities in a crowd funding initiative, official sources said Wednesday.

Gokhale was taken into custody under criminal sections of the Prevention of Money Laundering Act (PMLA) in Ahemdabad where he is lodged in judicial custody in a Gujarat Police case. He will be produced by the federal agency before a local court there seeking his remind, they said.

The Gujarat Police arrested Gokhale from Delhi December 29 in its case of alleged misuse of money he had collected through crowdfunding. Earlier in December, the Gujarat Police arrested him twice for allegedly spreading fake news regarding the cost incurred on Prime Minister Narendra Modi’s visit to Morbi town following a bridge collapse tragedy.

In Brief:

BCCI announces owners of Women’s IPL teams; combined valuation of ₹4,670 crore

The BCCI on Wednesday earned a ₹4,669.99 crore windfall for the sale of five teams in the inaugural Women’s Indian Premier League (WPL) with Adani Sportsline shelling out a massive ₹1,289 crore for the Ahmedabad team, which emerged the most expensive franchise. IPL team owners Mumbai Indians, Royal Challengers Bangalore and Delhi Capitals made successful bids of ₹912.99 crore, ₹901 crore and ₹810 crore respectively to enter the WPL. Capri Global Holdings got the Lucknow franchise for ₹757 crore.

Kangana Ranaut’s Twitter ban lifted after nearly 2 years

Two years after being banned from Twitter, Kangana Ranaut’s account has been reinstated. The Bollywood actress’s account had been suspended by Twitter in May 2021 for “repeated violations” of its hateful conduct and abusive behaviour policies. On her return, Kangana tweeted: “Hello everyone, it’s nice to be back here”. She then shared a clip from the making of her upcoming film Emergency, which will release in October 2023.

Evening Wrap will return tomorrow.

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