Adani FPIs ask deal in 2020 case but D-St watchdog wants truth

Nifty24, 252.0020.16. Motilal Oswal Midcap Fund Direct-Growth.

Key points

• Top Trending Stocks: SBI Share Cost, Axis Bank Share Rate, HDFC Bank Share Cost, Infosys Share Rate, Wipro Share Cost, NTPC Share Rate.
• Sebi rejects Adani FPIs settlement applicationsforeign portfolio investors settlementAdani Group investigation SebiSebi regulation 2018Hindenburg Research Adani allegationsFPIs compliance with Sebimarket manipulation Adani GroupSebi settlement regulations changes.
• Understanding business to figure out the mystery: Power Grid Corp – Part 1.
• Breach of Securities Law Another person remarked some FPIs, at a joint gathering with Sebi, were unwilling to 'disgorge' the amount sought by the regulator.
• This was since the FPIs' terms failed to align with those proposed by Sebi, they stated.

Nifty24, 252.0020.16. Motilal Oswal Midcap Fund Direct-Growth. The Economic Times daily newspaper is available online now. Sebi turns down Adani-linked FPIs' settlement applications. Sebi turns down Adani-linked FPIs' settlement applications. ET BureauLast Updated: Aug 24, 2026, 05: 46: 00 AM IST.

When Sebi's surveillance systems first flagged the unusual concentration of their holdings, the regulator communicated its decision to the FPIs' representatives last week, the individuals stated, reviving a case that dates back to October 2020. Sebi's investigation had flagged 13 FPIs. They subsequently sought to settle the case.

Mumbai: India's capital markets regulator has rejected settlement applications by foreign portfolio investors (FPIs) that held significant stakes in listed Adani Group firms, residents familiar with the matter noted. This was since the FPIs' terms failed to align with those proposed by Sebi, they stated. When Sebi's surveillance systems first flagged the unusual concentration of their holdings, the regulator communicated its decision to the FPIs' representatives last week, the individuals stated, reviving a case that dates back to October 2020. Sebi's investigation had flagged 13 FPIs. They subsequently sought to settle the case.

"The terms were not in line with the settlement terms suggested by Sebi. Therefore, Sebi rejected the application, " the regulator remarked in its communication to the FPIs. "This recommendation (rejection of the application) of HPAC (high-powered advisory committee on settlement orders) was accepted by the panel of whole-time members in terms of regulation 15(1) of the Settlement Regulations, 2018." ET has reviewed the letter's copy.: Sebi proposes tighter curbs on promotional claims by online bond platforms Live Events.

At the centre of the standoff, according to one of the individuals, was the reluctance of some FPIs to fully disclose information Sebi considered essential to any settlement. "You have to come clean if you want to settle a case. Some FPIs were unwilling to provide certain details to Sebi. It was a precondition for settlement, " the person remarked. "Entities must first agree to the non-monetary terms."

Breach of Securities Law Another person remarked some FPIs, at a joint gathering with Sebi, were unwilling to 'disgorge' the amount sought by the regulator. It ran into hundreds of crores. Settlement is a well-trodden route for entities facing securities law violations in India, one that lets them resolve disputes without admitting or denying wrongdoing. An applicant proposes terms to Sebi. It reviews the application and counters with its own, typically a monetary settlement amount, and sometimes non-monetary conditions such as trading bans. The two sides negotiate, and the final proposal goes to Sebi's high-powered advisory committee, led by a former high court judge, for approval or rejection. Meanwhile, the 13 FPIs are Albula Investment Fund, Cresta Fund, MGC Fund, Asia Investment Corporation (Mauritius), APMS Investment Fund, Elara India Opportunities Fund, Vespera Fund, LTS Investment Fund, Emerging India Focus Funds, EM Resurgent Fund, Polus Global Fund, New Leaina Investments and Opal Investments. The funds filed multiple settlement applications in April 2024 after Sebi issued show-cause notices to them under two separate tracks – one questioning why their FPI registrations should not be cancelled, and the other seeking to fine them for breaches of securities law. It could not be ascertained which applications were turned down. The regulator's original concern was whether these FPIs were genuine public shareholders, or fronts for the Adani Group's own promoters. For context, the probe gained global attention after a January 2023 report by Hindenburg Research accused the Adani Group of round-tripping and market manipulation, triggering a sharp sell-off in its stocks. The conglomerate denied the allegations. In its submissions to the Supreme Court in August 2023, against the backdrop of multiple public interest litigations seeking a probe into the Hindenburg claims, Sebi disclosed that it had reviewed trading in seven Adani stocks – Adani Enterprises, Adani Ports & SEZ, Adani Green Energy, Adani Energy Solutions, Adani Power, Adani Total Gas and Adani Wilmar – between March 2020 and December 2022, examining price-volume manipulation and breaches of minimum public shareholding, FPI investment limit and offshore derivative instrument norms. The regulator identified 42 contributories to the FPIs' assets under management. But it hit a wall trying to trace their ultimate beneficial owners, hampered by a lack of cooperation from its foreign counterparts. When the Supreme Court disposed of the PILs in January 2024, it directed Sebi to bring its investigations to a "logical conclusion in accordance with law." With Sebi rejecting the settlement applications, the regulator will now continue legal proceedings against the FPIs. Sebi, Adani Group and the FPIs did not respond to emailed queries. Second Chance The door may not stay shut for long. Sebi is planning to revise its settlement rules in a way that could offer rejected applicants, including, potentially, these FPIs, another shot at resolving their cases. At present, an entity that has had its settlement application rejected cannot reapply at any stage of proceedings, including during an appeal. Under the proposed changes, applicants would be allowed to return to the settlement table if circumstances have changed and the grounds for the original rejection no longer apply. The cost of a second chance: an further 20% on top of the settlement amount.

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In short, adani FPIs ask deal in 2020 case but D is the central thread here, and readers can expect follow-up reporting as the picture becomes clearer.