- #SupremeCourt dismisses all allegations against #AdaniGroup
- What do experts have to say about the judgment?
Find out where the market is pooling money today with Agam Vakil and Hiral Dadia on 'Hot Money'. #NDTVProfitLive
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- What do experts have to say about the judgment?
Find out where the market is pooling money today with Agam Vakil and Hiral Dadia on 'Hot Money'. #NDTVProfitLive
_______________________________________________________
For more videos subscribe to our channel: https://www.youtube.com/@NDTVProfitIndia
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TVTranscript
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02:16 Hello and welcome.
02:17 You're watching Hot Money.
02:18 I'm Hiral Dadya, and with me is Agam Vakil.
02:21 Clearly, if you go to see strong moves in terms of markets
02:24 as well is what we are seeing specifically with regards
02:27 to where the Adani-Hindenburg Supreme Court verdict that
02:31 has been announced.
02:32 That has been one of a booster dose.
02:34 Clearly, if you see from a markets perspective,
02:36 some pressure, but you are seeing some bit of profit
02:39 booking that's coming in now, but clear positivity that
02:42 comes in from all the group companies as well.
02:45 Let's quickly pull up Bank Nifty as well and see what
02:47 Bank Nifty is doing in trade.
02:49 Overall, if you see from markets perspective,
02:52 Bank Nifty has been slightly in an indecisive zone.
02:55 There you go.
02:56 It's trying to inch higher, but now a slight move in the
03:00 positive and again back in the negative as well.
03:02 But let's quickly shift focus and look at the key takeaways
03:06 that come in on the Adani-Hindenburg Supreme Court
03:10 verdict.
03:11 Now firstly, the Supreme Court has given a clean chit to Adani
03:14 Group and they've gone ahead and dismissed all allegations
03:17 and that's what has kept the Adani Group companies
03:20 absolutely afloat right now.
03:22 What they have indicated is that there will be no need to
03:25 interfere with the SEBI probe.
03:27 That's number two as a key takeaway that we are picking up
03:30 from the verdict and that SEBI should complete the probe
03:34 with the remainder two out of the 24 in the next three
03:38 months and there is no need for a CBI probe to come in in
03:42 terms of where the entire case goes.
03:45 Now there has been a loss of investors' wealth as well and
03:48 that is something which should be probed and the FBI regulation
03:53 has not been diluted.
03:56 There is no conflict of interest in Supreme Court appointed
03:59 expert committee and lastly, relying on media articles to
04:03 question the probe doesn't inspire confidence and that is
04:07 what the markets have been sharing.
04:09 If you pull up all the 10 Adani Group companies, interesting
04:12 moves coming in there from Adani Enterprises to Adani Ports,
04:15 Adani Green, all of them trading in the positive.
04:18 Let's look at the other stocks as well.
04:20 Wilma, Adani Total, Adani Power, you have ACC Ambuja, good
04:24 names coming in, good gains coming in, all of these names.
04:27 Agam, clearly the markets are cheering and giving it a thumbs
04:31 up in terms of the verdict.
04:33 What are you picking up?
04:34 If you have to see the kind of market cap erosion that we saw
04:37 during the Hindenburg case, from there to now, what are the
04:40 moves look like?
04:42 We have certainly seen a lot of relief when it comes to long
04:45 term investors in Adani Group companies and of course the fact
04:50 that we have the sentiment improving significantly after the
04:54 pronouncement from the Supreme Court and that in fact has
04:58 augured into about 57,000 crores worth of market cap added in
05:03 terms only from the Adani Group companies.
05:05 Now, remember that we are seeing a significant up move and while
05:09 a lot of these stocks are off days highs, we are seeing gains
05:12 all the same and we are seeing more and more addition in OI at
05:16 least in terms of flagship companies, something like Adani
05:19 Enterprises or Adani Ports, which is in fact seeing a lot more
05:22 increase in OI based on the kind of longs that we are seeing.
05:25 Even in the cash markets, we see advances, we are just pointing
05:29 out to Adani Energy, Adani Power, Adani Green, all these
05:34 stocks have been up and about and been advancing.
05:37 Of course, Adani PVR is the other one, Power, pardon me.
05:41 Besides that, we have also seen gains in something like Adani
05:45 Green as well.
05:46 So, sure, off days highs but gains all the same and well, a
05:50 lot more to come perhaps.
05:52 We are going to have to wait and watch because a lot of these
05:54 stocks have still not recovered to the period where this time
06:00 around, this year or this time, same time last year where we did
06:04 have, the trading, this was before Hindenburg.
06:08 That said, we also have seen about 8.19 lakh crores in market
06:12 cap added since Hindenburg lows.
06:15 So, that's significant and we will continue to keep an eye on
06:19 a whole host of these counters and gainers from the Adani Group
06:22 companies.
06:23 Heetal?
06:24 Absolutely and I think four of the ten companies are above the
06:27 Hindenburg lows as well.
06:28 So, that's going to be an interesting one as to when do the
06:31 others manage to come back into the green.
06:34 But that's with regards to the Adani Group companies but let's
06:37 quickly head across to my colleague Varun who's standing by and
06:41 he was at the Supreme Court as well where Supreme Court has
06:45 backed SEBI and given them a clean chit to Adani Group in
06:49 Hindenburg case and there has been a no-sit probe.
06:52 Varun Kakkar joins us with more.
06:54 Varun, what are you picking up and what are your key takeaways?
06:57 Supreme Court has come out with its verdict in the Adani Hindenburg
07:02 matter and it has reposed its faith in SEBI's powers as a regulator.
07:06 The top court has said that the petitioners were not able to
07:09 provide enough material on record for the matter to be transferred
07:13 to a special investigation team.
07:15 The top court has dismissed the petitions finding that a threshold
07:18 for a transfer of investigation has not been made out.
07:21 Further, allegations of conflict of interest against members of
07:24 the Supreme Court appointed expert committee have been ruled out.
07:27 The top court has further upheld the amendments made by the
07:30 Securities and Exchange Board of India to the FBI regulations
07:33 and the LODR regulations.
07:35 Lastly, noting that SEBI has completed its investigation in 22
07:39 out of the 24 matters that it had identified, the market regulator
07:43 has now gotten an extra three months to complete its investigation
07:46 into the matter.
07:48 Right. Well, on that note, let's get in our expert for today.
07:52 We have Ashish Maheshwari, Director, Arian Capital Markets,
07:55 who's going to be joining us in just some time.
07:58 But before that, let me quickly also talk about the other expert
08:04 that we spoke to and that was, of course, Supreme Court advocate
08:07 Vishal Tiwari, who is one of the petitioners in the Adani Hindenburg case.
08:11 Let's hear him out.
08:13 We are very much grateful that on our petitions, after considering
08:18 the petitions, a judgment has come.
08:20 And in all, if we will see this judgment, then we can bring out
08:24 a conclusion that for future some safety measures have been suggested
08:29 and how to strengthen the regulatory mechanism.
08:32 Those recommendations given by the expert committee upon that
08:36 Supreme Court has given directions that government shall consider
08:39 these recommendations and it shall take necessary steps.
08:42 And if such recommendations will be considered, then we are very much
08:46 sure that in future share market will be more secure and it will not
08:51 be upon the risk and the investors' money will be more secure
08:56 and will remain more safe.
08:58 So the court has said that a threshold for a transfer of investigation
09:01 has not been made and a petitioner's reliance on DRI's letters
09:06 are inconclusive. So what do you have to say about all this?
09:08 See, upon that, Supreme Court has very clearly said that we can
09:11 transfer and we have power to transfer. But in the present scenario,
09:15 in the present matters, we do not find any ground upon which
09:19 we can transfer the investigations from SEBI to some other agency.
09:23 So do you think the judgment that has been delivered today will work
09:26 positively for investor protection and investor strengthening?
09:29 Definitely. This was the concern of my petition and the judgments
09:32 and the recommendation upon which directions have been given by
09:35 the Supreme Court. Definitely in future, they will work if they are
09:38 implemented in their letter and spirit.
09:40 Right. So that was Advocate Vishal Tiwari who is clearly indicating
09:44 that investor wealth will be protected and that the Supreme Court
09:48 has now dismissed all allegations and they found no grounds to transfer
09:52 the case from SEBI to CBI. So that's a positive commentary coming in
09:57 on that one. But let's head across to Ashish Maheshwari,
10:00 Director at Arihant Capital Markets to get his views.
10:02 Ashish, good afternoon and welcome to the show.
10:05 My question to you is, taking into consideration the clean shit
10:09 that the Supreme Court has given to Adani Group,
10:12 all the stocks, yes, the positivity has come back.
10:16 What would your view be?
10:18 I think after the initial euphoria, now stocks have started settling down.
10:24 First thing is this. And again, I think investors need to wait for three months.
10:30 So what's the general expectation in the market that they are going to get
10:35 the clean shit in this hearing only.
10:39 But now they need to wait for three more months.
10:43 And I think after that verdict only, some correction we saw in the stock.
10:48 So in my view, some volatility is going to be there because those who have
10:53 built up their positions in view of clean shit to Adani Group,
10:58 they are liquidating their positions.
11:00 So in my view, we should not be in a hurry once again to grab these stocks.
11:07 We should get these stocks maybe even at lower price after some more correction.
11:12 So I think the stocks like Adani Port or Ambuja Ceilings are going to be in my buying radar.
11:18 But I'll wait for some more correction before I press the buy button.
11:23 Thanks, Ashish, for getting us your views as well.
11:25 And stay with us. We'll quickly slip into a short break.
11:28 Lots more lined up on the other side as well.
11:30 We'll be right back on What Money.
11:32 Continue to watch NDTV Profit.
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14:14 Well, a quick check on the markets before we continue with our coverage on Adani Hindenburg.
14:20 For now, we are looking at some amount of consolidation as far as the benchmarks are concerned
14:28 after the kind of volatility that we've seen in the first couple of hours of trade.
14:32 For now, while there has been a little bit more silence as compared to what we saw in the previous couple of hours,
14:39 well, all eyes will remain on the Bank Nifty.
14:42 Now, that has also come off days highs.
14:45 At the moment, it seems that it has made one attempt to move into the green.
14:50 That hasn't come to be.
14:51 And at the moment, it is currently trading flattish, marginally in the red, so to speak.
14:56 But the question is, where do we go from here?
14:58 Well, let's find out and see it and continue to keep a track on the indices.
15:04 But we will continue with the big news for today, and that is, of course, the Supreme Court
15:08 that has given a clean check to the Adani Group in the Hindenburg case, has dismissed all allegations,
15:14 says there is no need to interfere with the semi probe.
15:17 My colleague Alex Matthew has summarized the key highlights of the verdict.
15:21 Alex, over to you.
15:22 All right. Thanks so much for that.
15:24 Now, it was, of course, something that was looked forward to quite a bit.
15:29 And it was a ball of gloom for the Adani Group that seems to now be dissipating.
15:34 Let's take you through some of the key points that have been made by the chief justice of India.
15:39 In fact, the first and the most important point that they raised was that the Supreme Court
15:44 and its power to enter the regulatory domain in framing legislation is limited.
15:50 It is, in fact, depending on the judgment of an expert regulator to conduct investigations in due course.
15:58 The SEBI has completed 22 of the 24 investigations into allegations that were leveled against the Adani Group.
16:06 And the SEBI is satisfied with the progress of those investigations.
16:10 It has, in fact, directed the SEBI to continue with the two investigations that are pending
16:15 and to preferably complete it within a period of three months.
16:19 It has also said that it has not interfered in the outcome of the investigation by the SEBI.
16:25 And it is also saying that the SEBI should take the investigations to a logical conclusion in accordance with the law.
16:32 So it's not interfering in that process.
16:35 It has also said that a transference of this investigation from the SEBI to something like an SIT
16:42 or, in fact, the CBI is not warranted specifically on that.
16:47 It is saying that the threshold for transfer of investigation has not been demonstrated.
16:52 In a few cases, what normally occurs is that an investigation into certain infractions or alleged infractions
17:00 moves away from a traditional regulator into the hands of the CBI or another investigative agency.
17:07 That is not required in this case is what the CGI has said.
17:11 What else have they said?
17:13 The reliance on newspaper articles by the petitioners is not seen in a very good light by the CGI and indeed by the Supreme Court.
17:23 Specifically, what they've said is that the petitioners' reliance on DRI letters is misconceived as the issue has already been settled.
17:31 And they've also said very specifically, the CGI said, that the reliance on newspaper articles to question the comprehensive investigation by regulator does not inspire confidence.
17:41 Apart from that, you also have allegations of conflict of interest that were very firmly settled by the Supreme Court today.
17:49 It said that there is no conflict of interest with the SC appointed committee and they found that allegation unsubstantial.
17:57 Beyond that, they've in fact asked the SEBI to probe whether there has been any significant loss to retail investors on account of the Hindenburg case.
18:07 And if so, whether or not there was an infraction or there was an infraction of law in that case.
18:16 And they've asked them to probe whether the short selling by Hindenburg in the Adani Group and other entities in the Adani Group has resulted in the breaking of any laws.
18:26 So that's more or less where things stand right now.
18:29 It has been viewed, as you've rightly pointed out, as a clean chit for the Adani Group.
18:34 Absolutely. Thank you, Alex, for getting us the key takeaways, not only from a legal perspective, but to a financial perspective as well.
18:43 And putting it together for us as to what it would mean going ahead.
18:46 In fact, we also spoke to a slew of lawyers and market experts.
18:51 Sandeep Parikh, founder at Finsec Law Advisors, had to say about, let's hear what he had to say about the Supreme Court hearing.
18:58 I think the ruling is pretty clear in terms of, I think, the effort to the wisdom.
19:08 In judicial jargon, we call it judicial deference to an expert regulator, which essentially means when you have an expert body which is created by statute,
19:18 you rely on their judgment and not the judgment of newspaper reports or research reports, etc.
19:25 And I think the Supreme Court has given full deference to SEBI in terms of its investigation powers, that it's not abused its powers,
19:34 and that they believe that SEBI will take it to its logical conclusion, including the two investigations which are still pending,
19:43 which will obviously reach the logical conclusion as decided by SEBI.
19:49 And they've also found no grounds to transfer the case to CBI, etc., which would happen in extraordinary cases.
19:58 So that's kind of the summary of the post-mortem.
20:01 I also made other recommendations with respect to the report of the expert that we constitute.
20:07 We also spoke to Siddharth Luthra, senior advocate at Supreme Court and former additional solicitor general of India at the Supreme Court,
20:16 who told us what to make of the Supreme Court's verdict on the Adani-Hindenburg case. Let's hear about it.
20:24 As I said, there is the position of the Adani group stands clear in 20 of the instances.
20:31 For two, it's remaining. But apart from that, the issue that the regulator was soft on Adani or the regulator was not doing its duty or the regulations were not valid, have all been rejected.
20:45 So I think it's also important, not just for the Adani group, but for the regulatory system in India, that there's a recognition that there is a system in place and that system has not been flouted.
20:55 We also spoke to Complete Circus' Gurmeet Chadha on his view of the verdict as well as what lays in store for markets. This is what we had to say. Listen in.
21:07 After the verdict, there was some actually interesting, some moderation in prices, maybe some profit-taking.
21:13 So, I think more importantly, directionally also for the economy as a whole, as a country as a whole, it's positive because if you start...
21:23 See, governance standards is something which you can't be compromised, especially when it comes to FBI flows.
21:31 So any adverse verdict on one group also creates a slightly better spiral on the broader things.
21:41 We have some instances in the past. So I think Supreme Court did the right thing not really getting into the SEBI domain.
21:48 They made the point that almost 22 out of 24 cases are already completed, balance two now are only pertaining more to short selling.
21:57 And I think it's the government and SEBI job to look at that. It also, in a way, establishes the authority and credibility of SEBI as a regulator as well.
22:07 So, directionally it is positive also in general for the perception India has as far as the foreign flows are concerned.
22:14 And this is what Devin Choksi had to tell us about the verdict as well as what lays ahead as far as the group is concerned. Listen in.
22:23 I think two or three important points. Supreme Court has very clearly trusted SEBI and asked SEBI to complete the balance two investigation points out of 24 which are pending.
22:36 In less than three months time. So very clearly I think the matter is not further transferred to any other investigative agency.
22:43 I think which is a strong point here. Second thing I think very clearly recognized that the investigation process carried out by SEBI is probably in line with the expectations.
22:54 And there is nothing which is shortcoming in this particular process. So which is a good endorsement coming from the highest court of the country.
23:01 The third most important point I think which is an observation I believe. I think it's been communicated that the regulators should have the teeth to investigate the kind of situation which one has seen in case of Finderberg report in the media.
23:18 I think this kind of a situation regulators should possibly have the teeth in form of I think getting it examined in the jurisdiction which is outside their jurisdiction.
23:27 This is a situation which is basically implemented going forward by the regulations. In my view point I think the market will be much more safer than what it has played in this particular case.
23:39 Wherein the investors confidence in general not shaken up because of whatever the media report came up from the Hindenburg side.
23:48 I guess I think this is a positive part of the commentary. As far as I think the business outlook on the companies or the group business is concerned.
23:56 In my view point I think it remains absolutely robust with EBITDA to the net debt situation of less than four.
24:04 I don't think that I think one should be worrying about this kind of infrastructure companies which are generating close to 60,000 per year worth of annualized EBITDA which is growing at the rate of around 20 percent.
24:14 It's a net debt in the hands of around 2,10,000 per year. So to a greater extent I think this particular situation is paying out very well.
24:22 On the top of it I think in last 8, 21 I think one has seen the higher amount of capital inflows coming in from the other investors outside the company.
24:32 Financial investors have invested money into the company and the groups. So from that perspective I believe that this is a very positive outcome that the group is experiencing.
24:41 Maybe the dark cloud is over now. One can look forward to the business outlook of Adani Group of companies.
24:47 It will deliver a significant amount of optimism hereafter.
24:52 All right. Well we'll very quickly address a handful of, well at least one stock for now.
25:00 And besides the Adani Group we also have an update from Avenue Supermarts where we understand, well it has seen a good growth coming in as far as the quarter gone by is concerned.
25:10 About a 17 percent growth on a year on year basis. And it's also added the number of stores stands at around 341.
25:18 Now however do remember that this is a very costly company in terms of its share price at the moment.
25:26 And we do have Citi which has maintained its sell with a price target of 3,100 rupees per share.
25:31 Of course it currently trades near 4,000 rupees just shy of that mark.
25:35 Ashish, what's your view on Avenue Supermarts? What would you do with this on?
25:40 Today if you see 17 percent numbers they are in line with expectations.
25:47 But I think the market is slightly nervous on a number of store additions which is very slow.
25:52 So we see in the last quarter only five stores were added.
25:55 So in this kind of business, unless you are having a wider reach it will be very difficult to fight with that kind of expansion plan.
26:04 Like Jio etc are working on. So I think this is the reason slight nervousness is there on this front.
26:13 Otherwise as far as 17 percent volume growth is concerned I think it is in line.
26:19 Right. Thanks Ashish for getting us your views with regards to where Avenue Supermarts goes.
26:26 But we are running completely out of time. With that it's a wrap on this edition of Hot Money.
26:31 Thanks for watching and lots more lined up on the other side on NETB Profit.
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29:44 Hello, welcome to the Portfolio Manager. I am Neeraj Shah. This is the first Portfolio Manager show of 2024.
29:51 And who better to have here than Ace Investor Manish Sonthalia of MK Investment Managers who joins us right now
29:59 with his thoughts on what the portfolio construct should be in 2024 arguably beyond.
30:05 Manish I know you don't invest for just one year but because we have to do an annual call I am saying this this way.
30:10 But to you and your team and your family at the start at the onset of the show wishing you all a very happy 2024.
30:17 Very happy new year to you too at NTT Profit and entire team mates of yours and entire viewers of NTT Profit a very happy new year.