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Adani Power Delisting August 07 2021Stock Market Trading

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The Securities and Exchange Board of India (SEBI) is investigating Adani Power Ltd's proposition to delist its shares from exchanges, which could exacerbate problems for the Adani Group, which is already being investigated by the market regulator.

According to two people familiar with the situation, SEBI's investigation came after the Gautam Adani-owned company announced a share buyback at a price nearly 65 percent lower than the current market price.

Due to investor concerns following the SEBI investigation, Adani Power shares fell from 155.8 on June 10 to 88.75 on Thursday on the BSE.

Adani Power's board of directors approved the voluntary delisting proposal in June by purchasing back shares at a price of 33.82 per share. The board has already extended the proposed buyback date several times.

“Due to the unusual movements of the stock, SEBI may be extremely cautious of the delisting proposal. It raises some concerns when a company's intrinsic value is so much lower than the price resulting from public shareholder trading” one of the two people cited above said, speaking on the condition of anonymity.

“The delisting price was announced last year in accordance with the SEBI formula, but that price will no longer be very relevant, and why should any shareholder sell his or her shares for one-third of their value?” “SEBI is looking into a number of issues before clearing the delisting proposal,” the person added.

According to an Adani Power spokesperson, the company has not yet received any communication from Sebi regarding the proposed delisting of Adani Power. Separately, an Adani Group spokesperson stated, “There has been no such communication from authorities, nor has there been any such indication from concerned officials.”

An email which was sent to SEBI went unanswered.

Adani Power shares have more than doubled since the delisting announcement last year. With the sharp rise in the stock following the delisting announcement, the number of public shareholders nearly tripled.

The number of public investors in Adani Power increased from 334,000 in June 2020 to 981,000 in June 2021, according to the BSE.

Meanwhile, several investors remain optimistic that the Adani Group will prove all the allegations raised against it false.

With the regulator investigating several Adani Group companies for alleged securities law violations, as revealed by junior finance minister Pankaj Chaudhary in Parliament, and questions raised about the legitimacy of certain foreign portfolio investors in group firms, the markets regulator will be more comfortable approving Adani Power's voluntary delisting proposal once the probe is completed, according to people familiar with the matter.

Adani Power, Adani Power Delisting, Share market updates, Latest news 

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