Trinamool Congress MP Mahua Moitra on Wednesday asked market regulator Sebi, Enforcement Directorate, Income Tax Department if they will be investigating Hindenburg-hit Adani Group’s alleged reliance on offshore funding or not.
UK’s Financial Times reported that almost half of conglomerate’s $5.7 billion in FDI over 5 years came from opaque overseas entities.
“A Financial Times analysis of India’s FDI remittance statistics shows offshore companies linked to the Adanis invested at least $2.6 billion in the group between 2017 and 2022, 45.4 per cent of the more than $5.7 billion it received in total FDI over the period,” the report said.
The biggest investments came from two companies directly or indirectly linked to Vinod Adani, Adani Group chairman Gautam Adani’s elder brother, who is listed in stock exchange filings as a Cypriot national and lives in Dubai.
Now are these related parties or unrelated parties? @SEBI_India @dir_ed @IncomeTaxIndia pic.twitter.com/U9oEdv5gIE
Emerging Market Investment DMCC, which states on its website that it only invests Vinod Adani’s funds, ploughed $631 million into Adani companies between 2017 and 2018. Meanwhile, Mauritius-registered Gardenia Trade and Investment, which invested $782 million into Adani companies between 2021 and 2022, is directed by Emerging Market’s manager Subir Mittra, the report said.
On January 24, US short seller Hindenburg Research alleged stock manipulation and improper use of tax havens, and flagged concerns over debt levels at the company, which Adani has denied.
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The Hindenburg report said that Vinod Adani “manages a vast labyrinth of offshore shell entities” that have “collectively moved billions of dollars into Indian Adani publicly listed and private entities, often without required disclosure of the related party nature of the deals”.
On allegations of use of offshore entities for purposes of money laundering, it said that Hindenburg’s queries make reckless statements without any evidence whatsoever and purely based on unsubstantiated speculations without any understanding of the Indian laws around related parties and related-party transactions.
Although the Adani Group in its response to Hindenburg’s allegations has claimed that Vinod Adani has no official role and is not a related party.