The US authorities moving to drop fraud charges against Gautam Adani and the Adani Group is a big positive for the Indian conglomerate, according to market experts tracking the matter. Adani Enterprises share price has rallied 12% in the past five sessions. Group stocks like Adani Green, Adani Power etc are also up 7% and 4% respectively in this period.
Sanjay Asher, senior partner with Crawford Bayley & Co noted, while speaking to NDTV Profit, that the matter is sealed now and no further steps are to be taken. "Only procedural steps will be followed in due course", he explained. He further added that the expected closure will augure well for the group by bringing in more foreign investors.
The Justice Department may announce they are dropping the charges as soon as this week as authorities look to end a criminal case against the Adani Group chairman, Bloomberg reported on Thursday. The Securities and Exchange Commission will also move to settle a parallel civil fraud case against Adani and others, it added.
Also Read: US Authorities Moving To End Fraud Cases Against Gautam Adani
"The US SEC also has considered it is better to settle rather than contest... not always SEC would settle a complaint," Asher said, noting that the SEC considers a case fit for settlement only in the absence of a substantial evidence.
Deven Choksey of DRChoksey Finserv also believes that closing of the matter augers well for the Adani Group companies as it opens up possibilities for raising debt and equity capital.
"Global investors would like to invest money in India and Adani particularly... especially now that the overhang is gone," said Choksey, adding that "market is going to take it very positively." The group, which is pure infra play, is much more stronger today, added Choksey.
The SEC, Gautam Adani and Sagar Adani have filed their request for final judgment in the US court. Adani and his nephew Sagar Adani have consented to settlement without admitting or denying the allegations made in the civil complaint.
The final judgment of the US Eastern District NY Court is now awaited.
(Disclaimer: New Delhi Television is a subsidiary of AMG Media Networks Limited, an Adani Group Company.)
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