Adani Stocks Drop Amid U.S. Fraud Probe Into Founder

• Adani Green Energy dropped 12%, Adani Enterprises fell over 8%, and Adani Power declined 5% on Friday following the news
• The SEC alleges Adani executives misled U.S. and international investors about anti-bribery compliance while raising more than $3 billion in capital
• The SEC told the court it repeatedly sought assistance from the Indian government to deliver summons but was unsuccessful

Summary: Adani Stocks Drop Amid U.S. Fraud Probe

Key Developments:

Adani Group stocks experienced significant declines on Friday as the U.S. Securities and Exchange Commission (SEC) seeks permission to issue legal summons to founder Gautam Adani and other executives. Adani Green Energy plummeted 12%, flagship Adani Enterprises fell over 8%, and Adani Power dropped 5%.

Legal Proceedings:

The SEC has petitioned U.S. District Judge Nicholas Garaufis in Brooklyn for authorization to summon Gautam Adani and Sagar Adani, executive director of Adani Green Energy. This follows November 2024 indictments in New York federal court, where Gautam Adani and seven others were charged in connection with an alleged massive bribery and fraud scheme.

Charges and Allegations:

The defendants allegedly paid more than $250 million in bribes to Indian government officials to secure solar energy supply contracts valued at over $2 billion in profits. Additionally, Adani Group executives are accused of deceiving U.S. and international investors regarding the company's anti-bribery and anti-corruption compliance while raising over $3 billion in capital for energy contracts.

International Complications:

According to Bloomberg, the SEC reported unsuccessful attempts to deliver summons through the Indian government, prompting the court petition for alternative delivery methods.

Market Impact:

The renewed focus on the fraud allegations has created immediate negative pressure on Adani Group equities, affecting multiple portfolio companies. The case involves one of the world's wealthiest individuals and one of India's largest conglomerates, raising concerns about corporate governance and international investment risks in the region.