Adani Enterprises got 2 show cause notices from SEBI in Q4

Adani Enterprises on Thursday said the company received two show cause notices from market regulator SEBI (Securities and Exchange Board of India) alleging non-compliance with provisions of the Listing Agreement and LODR Regulations pertaining to related party transactions.

The show cause notices were part of SEBI’s ongoing investigation into certain related party transactions.

“During the quarter ended 31st March 2024, the Parent Company has received two show cause notices (SCNs) from the SEBI alleging non-compliance of provisions of the Listing Agreement and LODR Regulations pertaining to related party transactions in respect of certain transactions with third parties and validity of peer review certificates of statutory auditors with respect to earlier years,” Adani Enterprises says in a regulatory filing.

“The management believes that there is no material consequential effect of above SCNs to relevant financial statements and no material non-compliance of applicable laws and regulations,” the filing says.

In January this year, the Supreme Court directed SEBI to complete its pending investigation into the allegations made by U.S. short seller Hindenburg Research within three months.

“In this regard. certain writ petitions were filed with the Hon'ble Supreme Court seeking independent investigation of the allegations in SSR. During the proceedings, SC observed that the Securities and Exchange Board of India was investigating the matter. The SC also constituted an Expert Committee to investigate as well as suggest measures to strengthen existing laws and regulations and also directed the SEBI to consider certain additional aspects in its scope. The Expert Committee submitted its report dated 6th May 2023, finding no regulatory failure in respect of applicable laws and regulations,” the filing states.

“Based on above independent assessment, the SC order and the fact that there are no pending regulatory or adjudicatory proceedings as of date, except as mentioned above, the management concludes that that there is no material non-compliance of applicable laws and regulations and accordingly, these financial statements do not carry any adjustments in this regard,” the Gautam Adani-led conglomerate says.

Net profit of Adani Enterprises plunged 38% year-on-year to ₹450 crore for the quarter ended March 31, 2024, compared with ₹772.48 crore in the corresponding quarter last year. The Adani group’s flagship company posted ₹1,888.45-crore profit in the previous quarter.

Revenue of India’s largest private airport operator increased 0.8% to ₹29,180.02 crore during the fourth quarter as against ₹28,943.84 crore in the year-ago quarter.

Consolidated earnings before interest, taxes, depreciation and amortisation (EBITDA) stood at ₹3,646 crore versus ₹3,974 crore in Q4FY23. Airports EBIDTA grew by 130% to ₹662 crore.