Optimize IAS
  • Home
  • About Us
  • Free Initiatives
    • Daily Practice Sheets
    • Daily Prelims Notes
    • Prelims Power Play
    • Mains Factly
    • Sunday Essay Sadhna
    • Mains Master Notes
  • Courses
    • Mains 2023
      • Mains 2023 (Static)
      • Ethics Masterclass 2023
      • Essay Masterclass 2023
    • Integrated Guidance 2024
      • ARJUNA PRIME 2024
    • Prelims 2024
      • Laqshya 2024
    • Mains 2024
      • DPS Prime 2024 (Daily Answer Writing)
  • Downloads
    • Important Topics List for Prelims 2023
    • Daily Prelims Notes Compilation
    • Daily Practice Sheet Compilation
    • PPP Compilation
    • PSIR Notes
    • General Studies Notes
    • UPSC Mains Previous Year Papers
  • Portal Login
  • Home
  • About Us
  • Free Initiatives
    • Daily Practice Sheets
    • Daily Prelims Notes
    • Prelims Power Play
    • Mains Factly
    • Sunday Essay Sadhna
    • Mains Master Notes
  • Courses
    • Mains 2023
      • Mains 2023 (Static)
      • Ethics Masterclass 2023
      • Essay Masterclass 2023
    • Integrated Guidance 2024
      • ARJUNA PRIME 2024
    • Prelims 2024
      • Laqshya 2024
    • Mains 2024
      • DPS Prime 2024 (Daily Answer Writing)
  • Downloads
    • Important Topics List for Prelims 2023
    • Daily Prelims Notes Compilation
    • Daily Practice Sheet Compilation
    • PPP Compilation
    • PSIR Notes
    • General Studies Notes
    • UPSC Mains Previous Year Papers
  • Portal Login

Adani-Hindenburg Supreme Court Panel Report

  • May 20, 2023
  • Posted by: OptimizeIAS Team
  • Category: DPN Topics
No Comments
Print Friendly, PDF & Email

 

 

Adani-Hindenburg Supreme Court Panel Report

Subject :Economy

Section: Capital Market

Context: Supreme Court on Friday (May 19) made public the report of the court-appointed expert panel in the Hindenburg-Adani row case. SEBI) is yet to submit its report, the expert panel in its report disclosed that SEBI has been investigating the ownership of 13 “opaque” overseas entities related to Adani since October 2020.

The committee covered the following:

  • Market Volatility: Report found high volatility in the securities market due to the Hindenburg-Adani row.
  • On the first issue, the report says that while “there was certainly high volatility in Adani stocks after publication of the Hindenburg report”
  • Investor Awareness: agreed with SEBI’s steps on ensuring investors are making informed decisions, but questioned whether there is too much information for the average investor.
  • Regulatory failure if any that led to the conclusions drawn by the Hindenburg report. panel said that SEBI is looking into whether Adani has floated regulations in three aspects.
    • Minimum public shareholding: Sebi regulations require a publicly listed company to have a minimum of 25% of its shares to be held by the public. To assess this SEBI is looking at the ownership of certain portfolio investors. (of 13 overseas entities, 12 are foreign porfolio investors)
    • Related Party transactions: SEBI (Listing Obligations and Disclosure Requirements) requires disclosure of transactions by listed companies with related parties that benefit related party (ie. Adani here). No comment as investigation still on.
    • Price Maipulation: No evidence yet. SEBI’s active surveillance framework that tracks high price and volume movements has not found any manipulation till now, although several alerts were triggered, even before the Hindenburg report.
  • The 6 member committee comprised of two former justices, one former SBI chairman, one securities lawyer and Infosys co-founder Nandan Nilekani.
Why the issue is important: Some fundamentals

  • Stock market ‘Efficiency’’ requires that the price discovery, is determined by publicly available information only. In a ‘perfectly efficient market’, no one can make extra profits than any other. Related party trading and insider trading go against this principle.
  • Volatility is the name for variation in the price during a period. Abnormal volatility, is indicative of speculation or any other unfair practice, and is unhealthy from investor confidence point of view.
  • The 25% holding to be with public is a measure to ensure that big stakeholders cannot manipulate price of a stock.
  • The role of market regulator SEBI is most important in ensuring all of the above, hence concerns about regulatory failure.
Adani-Hindenburg Supreme Court Panel Report economy
Print Friendly, PDF & Email
Loading

Recent Posts

  • Daily Prelims Notes 3 June 2023 June 3, 2023
  • Iran-Taliban water conflict June 3, 2023
  • Kosovo-Serbia tensions June 3, 2023
  • UGC Chairman says new guidelines for deemed-to be varsities are ‘light but tight’ June 3, 2023
  • ‘Mural in new Parliament is of Ashokan kingdom’ June 3, 2023
  • RBI releases directions on cyber security for Payment System Operators (PSOs) June 3, 2023
  • U.S. averts first-ever default with 11th-hour debt deal June 3, 2023
  • BRICS that could be bigger June 3, 2023
  • For the cool summer so far, thank the frequent spells of rain June 3, 2023
  • UN agency warns there is no let-up in drugs trade from Asia’s Golden Triangle June 3, 2023

About

If IAS is your destination, begin your journey with Optimize IAS.

Hi There, I am Santosh I have the unique distinction of clearing all 6 UPSC CSE Prelims with huge margins.

I mastered the art of clearing UPSC CSE Prelims and in the process devised an unbeatable strategy to ace Prelims which many students struggle to do.

Free Initiatives

  • Daily Practice Sheets
  • Daily Prelims Notes
  • Mains Factly
  • Prelims Power Play
  • Sunday Essay Sadhna

My Proven Strategy

  • Interview Strategy
  • Mains Strategy
  • Motivational
  • Prelims Strategy

Contact us

moc.saiezimitpo@tcatnoc

For More Details

Work with Us

Connect With Me

Santosh Pandey Quora Santosh Sir Telegram Santosh Sir Youtube Optimize IAS Instagram

Course Portal
Search