Hindenburg responds to SEBI on Adani show cause notice: 10 key points of defence

Key Points From The Hindenburg Research Rebuttal:

• “For context, our archetypal study was 106-pages, with 32,000 words, and included 720 citations, collectively detailing grounds that Adani “engaged successful a brazen banal manipulation and accounting fraud strategy implicit the people of decades.””
• “The study provided grounds of a immense web of offshore ammunition entities controlled by Gautam Adani’s brother, Vinod Adani, and adjacent associates. We elaborate however billions were surreptitiously moved done these entities, into and retired of Adani nationalist and backstage entities, often without related-party disclosures.”
• “We besides elaborate however a web of opaque offshore money operators surreptitiously helped Adani evade minimum shareholder listing rules, citing galore nationalist documents and interviews to substantiate the allegations.”
• “Shortly aft our report, successful August 2023, “Big-4” auditor Deloitte resigned from its relation arsenic statutory auditor for Adani Ports, citing undisclosed related-party transactions flagged successful our study arsenic the ground for a qualified sentiment that accompanied its resignation.”
• “Following our archetypal Adani report, astatine slightest 40 autarkic media investigations corroborated oregon expounded connected our findings, presenting grounds of wide fraud by Adani against shareholders and Indian taxpayers, arsenic elaborate later.” 
• “To this day, Adani has inactive failed to code the allegations successful our report, alternatively providing a effect that ignored each cardinal contented we raised and has offered broad denials of consequent media allegations.”
• “The archetypal sections of SEBI’s 46-page Show Cause Notice to america outlined inheritance connected the Hindenburg report’s work and an mentation of our narration with an capitalist that expressed a abbreviated presumption successful Adani. Much of the announcement seemed designed to connote that our ineligible and disclosed concern stance was thing concealed oregon insidious, oregon to beforehand caller ineligible arguments claiming jurisdiction implicit us. Note that we are a U.S.-based probe steadfast with zero Indian entities, employees, consultants oregon operations.”
• “Some of these arguments seemed circular. For example, the regulator claimed that the disclaimers successful our study were misleading due to the fact that we were “indirectly participating successful the Indian securities market,” and, therefore, were abbreviated Adani. [Pg. 30] This wasn’t a mystery—virtually everyone connected world knew we were abbreviated Adani due to the fact that we prominently and repeatedly disclosed it.”
• “While SEBI seemingly tied itself successful knots to assertion jurisdiction implicit us, its announcement conspicuously failed to sanction the enactment that has an existent necktie to India: Kotak Bank, 1 of India’s largest banks and brokerage firms founded by Uday Kotak, which created and oversaw the offshore money operation utilized by our capitalist spouse to stake against Adani. Instead it simply named the K-India Opportunities money and masked the “Kotak” sanction with the acronym “KMIL”. Uday Kotak, laminitis of the bank, personally led SEBI’s 2017 Committee connected Corporate Governance. We fishy SEBI’s deficiency of notation of Kotak oregon immoderate different Kotak committee subordinate whitethorn beryllium meant to support yet different almighty Indian businessman from the imaginable of scrutiny, a relation SEBI seems to embrace.”
• “SEBI did not allege immoderate facet of our statement was false. Rather, it argued that CESTAT looked astatine the earlier lawsuit and alleged that we “sensationalized oregon distorted definite facts” by utilizing the connection “scandal” to picture the anterior alleged INR 6.8 cardinal strategy by Adani that resulted successful a 239-page bid from the Commissioner of Customs detailing grounds of fraud, an INR 250 cardinal (U.S. $4.6 million) fine, and extended consequent ineligible proceedings. Again, they took objection with the information that we called this a “scandal.” SEBI besides argued that we “cherry-picked facts” by omitting that the Supreme Court aboriginal declined to instrumentality up the lawsuit connected appeal, a wholly irrelevant portion of accusation that successful nary mode alters immoderate facet of our findings.”