Eros International, MD is prohibited by Sebi. MKTs’ Sunil Lulla
Eros International, MD is prohibited by Sebi. MKTs’ Sunil Lulla
Introduction: The Securities and Exchange Board of India (SEBI) has taken action against Eros International Media and Adani Group, two prominent entities in the Indian market. Eros International Media and its executives have been accused of fund diversion and financial misreporting, while the Adani Group is being investigated by US authorities over allegations of market manipulation. This article will provide a step-by-step breakdown of the events surrounding these controversies.
Eros International Media Controversy: In a recent development, SEBI has barred Eros International Media and four individuals, including the executive vice chairman and managing director Sunil Lulla and CEO Pradeep Dwivedi, from accessing the securities market. The order was issued after SEBI found evidence of fund diversion and financial misreporting by the company. Additionally, two affiliated firms, Eros Worldwide and Eros Digital Private, have also faced restrictions.
SEBI’s interim ex-parte order revealed that approximately 1,247 crore rupees (around 187 million USD) has become untraceable, with Eros having written off nearly 94% of this amount. Furthermore, the ongoing investigation suggests that Eros potentially diverted 687 crore rupees (approximately 103 million USD). These findings highlight serious financial irregularities within the company.
Adani Group’s US Investigation : The Adani Group, a prominent Indian conglomerate, has come under scrutiny from US authorities, including the Securities and Exchange Commission (SEC) and the Attorney’s Office in Brooklyn, New York. The investigation was triggered by allegations made by Hindenburg Research, a renowned investment research firm, accusing Adani of using offshore companies to manipulate its share prices.
he Bloomberg report on the Adani Group’s alleged market manipulation had a notable impact on the company’s shares. Following the release of the report, Adani shares faced substantial downward pressure, with most of the group’s stocks experiencing a decline ranging from 2% to 7%. Among them, Adani Enterprises, a flagship company of the conglomerate, closed 7.02% lower at Rs 2229.
The decline in share prices indicates investor concern and loss of confidence in the Adani Group due to the allegations raised by Hindenburg Research. These allegations accused the group of using offshore companies to manipulate its share prices, leading to a significant market reaction.
In response to the allegations, US authorities, including the Securities and Exchange Commission (SEC) and the Attorney’s Office in Brooklyn, New York, initiated inquiries into the matter. Institutional investors who hold substantial stakes in the Adani Group have been contacted by these authorities, seeking information regarding the representations made by the group to its American investors.
The inquiries from the Attorney’s Office and SEC demonstrate the seriousness with which the allegations against the Adani Group are being treated. These authorities are investigating whether the group provided accurate and transparent information to its investors in the United States. The focus is on determining the veracity of the claims made by Hindenburg Research and assessing the potential impact of any market manipulation on the investors’ interests.
As the investigations progress, it is essential for the Adani Group to cooperate fully with the authorities, providing the requested information and ensuring transparency throughout the process. The outcome of these inquiries will have significant implications for the reputation and future operations of the conglomerate, as well as for the investors involved.
Conclusion : The controversies surrounding Eros International Media and Adani Group have brought the spotlight on financial irregularities and market manipulation. SEBI’s action against Eros demonstrates its commitment to ensuring accountability in the securities market. Meanwhile, the US investigation into Adani Group highlights the global reach and impact of such allegations.
As these investigations progress, it remains crucial for regulatory bodies to conduct thorough inquiries and establish transparency in the market. Investors and stakeholders must remain vigilant in assessing the credibility and integrity of the companies they engage with. These events serve as a reminder of the importance of maintaining ethical practices and adhering to regulatory guidelines to preserve investor confidence in the securities market.
