Probe Hindenburg Research and those who made fortunes: Harish Salve
What's the story
Former Solicitor General of India (SGI) and senior Lawyer Harish Salve said on Friday that the primary goal of United States based short-seller Hindenburg Research's report on Adani Group was to make a profit on the misfortune of middle-class investors.
While demanding a thorough probe into the issue, Salve stated that anyone who has made a fortune by shorting stocks must be held accountable.
Context
Why does this story matter?
The comments come days after the Supreme Court (SC) ordered a probe by an expert committee.
Adani Group stocks have plummeted since Hindenburg published the report accusing it of accounting fraud and market manipulation.
The SC got involved after four petitions concerning the matter reached the court. It had observed that Indian investors suffered a massive loss due to the group's market performance.
Statement
Hindenburg made money off misfortunes: Senior lawyer Harish Salve
Salve said Hindenburg "is no Good Samaritan" as it made money off the misfortune of the middle-class investor.
In an interview with NDTV, Salve said the report was a well-thought target for earning by short-selling stocks.
"The (probe) committee must find out all those who have made tonnes of money at the cost of the middle-class investor by shorting shares," he said.
Demand
We must set an example in our market: Salve
Salve, Gautam Adani's ex-lawyer, demanded a ban on the market manipulators from trading.
"We must set an example in our market-that first of all if there is a report, it must go to SEBI, it must go to the Serious Fraud Office, it must go to the Ministry of Corporate Affairs - they will investigate and deal with such matters," he said.
Quote
Salve says SEBI will not sit quietly
"But if you are going to use reports like this to attack companies, the SEBI will not sit quietly. They will go after the people who are exploiting market volatility, who have moneybags, exploiting volatility, hitting the middle-class investor," he said.
Demand
Indian markets new to short-selling game, investors terrified
Salve claimed that the Indian market was new to the short-selling game, which is why the Hindenburg report terrified the investors because by the time it is proven false, it will be too late.
"We must have some institutional mechanism to say that the people who are making money off this misfortune of the middle-class shareholders are held to account," he said.
Investigation
Supreme Court probe underway in Adani-Hindenburg row
The Supreme Court has formed a six-member probe panel, headed by retired judge Abhay Manohar Sapre, to investigate the Adani-Hindenburg row and suggest measures to strengthen the legal framework.
Chief Justice of India (CJI) DY Chandrachud also directed the Securities and Exchange Board of India (SEBI) to complete its investigation following the Hindenburg report in two months and submit a status report.
Welcome
Adani welcomed the probe, says 'truth will prevail'
Adani welcomed the Supreme Court's order on the Adani Group-Hindenburg Research case on Thursday.
The apex court ordered the setting up of a committee to examine whether the conglomerate violated market norms or the stock prices were manipulated.
Following the top court's order, Adani tweeted, "It will bring finality in a time bound manner. Truth will prevail."