Jim Rogers Exclusive: 'Adani Stocks Can Be A Buying Opportunity If…'

The regulatory overhang on the Adani Group is over with India's market regulator, the Securities and Exchange Board of India (SEBI), dismissing allegations of stock manipulation and hidden transactions. In the wake of this development, legendary investor Jim Rogers has suggested that if the regulatory clearance is comprehensive, it could signal a classic buying opportunity for the conglomerate's stocks.

The saga began in early 2023 when US-based short seller Hindenburg Research published a report alleging stock manipulation and accounting fraud by the Adani Group. The report triggered a sell-off in Adani Group stocks, causing panic among both institutional and retail investors.

The SEBI investigation, prompted by a Supreme Court directive, focused on key allegations, including the use of related parties to route funds to listed entities. According to recent orders, the regulator concluded that the allegations could not be established, citing that the transactions in question did not fall under the definition of "related-party transactions" at the time they occurred.

In an interview with NDTV Profit, Jim Rogers, known for his decades of experience navigating global markets, commented on the situation, stating that he does not know the specifics of the Adani case. However, he drew on his extensive knowledge of market dynamics to offer a broader perspective.

"If the courts and the regulators have said the company's okay, then... you should be buying the stock," Rogers said. "If the regulators have done their homework and done their research and said everything is okay, this could be a buying opportunity."

Rogers’ remarks underscore the importance of regulatory action in restoring investor confidence. For a group that saw its valuation plummet and faced intense scrutiny, a definitive "clean chit" from the country's top market regulator serves as a powerful validation of its governance and transparency.

Rogers added that the panic seen in the market was a classic reaction from new investors in a bull market where any bad news could be seen as negative.

Ultimately, Rogers suggested that a regulator's all-clear can be a potent signal for savvy investors. While acknowledging the pain of investors who lost money during the crisis, he pointed out that such volatility is part of a dynamic market.

According to Rogers, the end of this regulatory chapter could mean that investors can now shift their focus from the Hindenburg allegations to the Adani Group's business fundamentals.

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