THE Securities and Exchange Board of India (SEBI), India’s market regulator, has accused Pranav Adani, director of several Adani group companies and nephew of Gautam Adani, of sharing unpublished price sensitive information in violation of insider trading rules, according to a document reviewed by Reuters.
SEBI sent Pranav Adani a notice last year alleging that he shared details about Adani Green's 2021 acquisition of SB Energy Holdings with his brother-in-law before the deal was made public, a source and the SEBI document said.
The matter has not been reported earlier.
In an e-mailed response to Reuters, Pranav Adani said he was seeking to settle the charges "to put an end to the matter, without admission or denial of the allegations" and added that "he has not violated any securities law".
A source with direct knowledge of the matter told Reuters settlement terms were being discussed. The source declined to be named as the matter is confidential.
The SEBI document stated that Pranav Adani "communicated UPSI (unpublished price sensitive information) pertaining to the SB Energy acquisition" to his brother-in-law Kunal Shah in 2021. SEBI’s investigation reviewed call records and trading patterns.
According to the document, Kunal Shah and his brother Nrupal Shah traded in shares of Adani Green and made gains of 9 million rupees ($108,000).
In a statement sent by their law firm, the Shah brothers said the trades were not carried out with “knowledge of any unpublished price sensitive information nor with any mala fide intent.”
"The information in question was already generally available in the public domain," the statement said.
Adani Green acquired SB Energy on May 17, 2021, at an enterprise value of $3.5 billion. SEBI said Pranav Adani became aware of the impending deal two to three days before May 16, 2021, when the acquisition was finalised.
The source added that SEBI had also proposed a settlement to Kunal and Nrupal Shah, but they chose to contest the charges, calling the settlement terms too onerous.
SEBI will take up Pranav Adani’s settlement request after completing its ongoing review of the settlement process.
Last year, US authorities indicted Gautam Adani and two Adani Green executives for allegedly paying bribes to secure power supply contracts and misleading US investors. The group denied the charges and called them “baseless.”
(With inputs from Reuters)
