Aniket PujariMumbai: The Securities and Exchange Board of India (Sebi) has dismissed insider-trading allegations against Pranav Adani and six others, closing a long-running investigation into trades executed ahead of Adani Green Energy Ltd’s (AGEL) announcement of its $3.5 billion acquisition of SB Energy in May 2021.
In two separate orders, released on Friday, the regulator concluded that the charges could not be established, after finding that the assumptions underlying the show-cause notices, including the duration of the unpublished price-sensitive information (UPSI) period and the status of information in the public domain, were inconsistent with the evidence on record.
The regulator reconstructed in detail how discussions between AGEL and the sellers of SB Energy progressed. According to the orders, internal deliberations, preliminary exchanges and indicative valuations circulated within AGEL until mid-May did not classify as UPSI.
Sebi said the information began taking a more definitive shape only after the execution of a non-disclosure agreement between the parties on 13 May 2021, when the virtual data room was opened and the negotiation moved from preliminary exchanges to concrete due diligence and transaction workstreams. Even then, the same elements identified by the investigation report as UPSI were disclosed in the public domain shortly thereafter.
The orders reproduce detailed press reports published on 16 and 17 May 2021, which described AGEL’s potential acquisition of SB Energy, the size and nature of SB Energy’s renewable portfolio, the status of ongoing discussions, expected valuation contours and AGEL’s internal progress on due diligence. Sebi observed that these reports brought into the public domain information that the show-cause notices had treated as UPSI, making the information “generally available” from the afternoon of 16 May.
The regulator also recorded that AGEL’s share price reacted sharply to these publications, with the stock hitting the upper circuit on 17 May and rising further on 18 May, which are moves larger than the one seen on the actual announcement day, 19 May 2021, when the stock rose 3.75%.
Across both cases, the regulator remarked that the investigation’s foundational assumptions, particularly the SCN’s framing of the UPSI period as running from 29 April to 19 May, were inconsistent with the evidence, AGEL’s own clarifications and the chronology established in the orders. As the information had either not yet become UPSI or had entered the public domain before the trades, Sebi found no basis to sustain the allegations.
Insider-trading allegations
Sebi’s two insider-trading proceedings, one involving Pranav Adani, and the other involving Vinod Bahety and entities connected to him, stem from AGEL’s acquisition of SB Energy from SoftBank Group Capital and Bharti Global, announced on 19 May 2021.
The regulator viewed the transaction as price-sensitive because it expanded AGEL’s operational capacity by 46% and its overall portfolio by 33%. Sebi initially alleged that Pranav Adani, a director in multiple Adani Group companies, was in possession of UPSI about the acquisition and communicated it to his relatives Kunal and Nrupal Shah, who allegedly traded AGEL shares on that basis and made unlawful gains.
Similarly, Sebi alleged that Bahety, then heading mergers and acquisitions at the group, had similar access to UPSI and passed it to connected entities, including Rajtaru Enterprises and MC Jain Infoservices, which also traded in AGEL during the period. Both investigations covered trades executed between 28 January and 20 August 2021, after Sebi appointed an Investigating Officer on 20 April 2023 to examine possible insider trading linked to the impending acquisition.
