SEBI warns 2 offshore funds holding Adani shares with penalties

India's markets regulator has warned two Mauritius-based funds with ties to Adani group. According to documents reviewed by Reuters, the funds in question could face penalties and cancellation of licences for not sharing shareholder details despite multiple requests.

The Adani group and its offshore investors have been under the regulatory radar since a report in 2023 alleged improper use of tax havens and other malpractices. The group has repeatedly denied any wrongdoings.

What does SEBI say?

Indian regulations require at least 25 per cent of the shares be held by public shareholders. This was put to test as the Group was accused of breaching these rules with its offshore funds.

The two Mauritius-based funds were asked to provide 'granular disclosures' of all their shareholders since they had 'concentrated positions' in the Adani Group. This is based on a document reviewed by Reuters dated March 28.

'To date, this has not been provided by these FPIs (Foreign portfolio investors) to SEBI...they have also not provided any reasons,' Reuters said quoting the document.

The two funds have reportedly applied to SEBI, requesting a monetary fine instead of disclosing documents. This is according to Reuters. At least two other offshore investors in Adani stocks are yet to supply information on Adani holdings.

The US authorities had earlier indicted group chairman Gautam Adani and some other executives, alleging they paid bribes to secure Indian contracts and misled investors. Adani denied any wrongdoing, saying the allegations are baseless. later, the act based on which the case was filed, was dismissed when Trump came to power.

Adani group is yet to respond to WION’s request for comments on this.