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
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.
investor concerns following the SEBI investigation, Adani Power shares fell
from 155.8 on June 10 to 88.75 on Thursday on the BSE.
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.
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.
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
which was sent to SEBI went unanswered.
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.
of public investors in Adani Power increased from 334,000 in June 2020 to
981,000 in June 2021, according to the BSE.
several investors remain optimistic that the Adani Group will prove all the
allegations raised against it false.
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.
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