SEBI Warns Mauritius-Based Funds Invested in Adani Over Non-Disclosure

India’s capital market regulator, the Securities and Exchange Board (SEBI) has issued a stern warning to two Mauritius-based investment funds with significant holdings in the Adani Group. The regulator cautioned that they risk fines and license cancellation for repeatedly failing to disclose detailed shareholder information, despite requests spanning over two years as per news reports.

SEBI Investigation on Adani Group

The Adani Group, along with 13 offshore entities linked to it, has been under SEBI investigation since 2023, following a report by U.S.-based Hindenburg Research. The report accused the conglomerate of leveraging offshore tax havens to manipulate stock prices, allegations that sparked a sharp market sell-off. The Adani Group has consistently denied any wrongdoing, and its share prices have since rebounded.

Under Indian regulations, at least 25% of a listed company’s shares must be held by public shareholders. Hindenburg’s report suggested that the Adani Group may have violated this rule by using offshore funds allegedly tied to the conglomerate to maintain indirect control over its own shares.

Also Read: Adani Enterprises, Adani Ports: Which Adani Group Stock Delivered the Highest Q4FY25 Profit

Funds Under Scrutiny

Two funds in particular — Elara India Opportunities Fund and Vespera Fund — have drawn SEBI’s attention. The regulator has been demanding "granular disclosures" of these funds' ultimate beneficial owners since 2023, due to their "concentrated positions" in Adani-related stocks, according to a SEBI document dated March 28.

“To date, this information has not been provided to SEBI by the foreign portfolio investors (FPIs) concerned,” the document states. “They have also not offered any explanation for the non-compliance,” it adds, noting that the delay has obstructed SEBI’s probe into whether the Adani Group has adhered to the minimum public shareholding requirements.

Widening Investigation

The controversy surrounding Adani has expanded beyond regulatory compliance. In November, U.S. authorities indicted group chairman Gautam Adani and several senior executives on allegations of bribery to secure Indian power contracts and of misleading American investors during fundraising efforts. Adani has firmly denied the allegations, calling them “unfounded and politically motivated.”

In addition to Elara and Vespera, two other Mauritius-based investors — Lotus Investment and LTS Investment — have also failed to furnish the requested information about their holdings in Adani companies.

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