Kotak Mahindra Bank Replies to SEBI on Adani Stock Short-Selling Allegations

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Kotak Mahindra Bank clarifies its stance in response to SEBI's show-cause notice concerning allegations of short-selling Adani Enterprises' stock before the Hindenburg Research report. The bank confirms full cooperation with SEBI in the Adani-Hindenburg matter.

Kotak Mahindra Bank News Today

On July 2, Kotak Mahindra Bank issued a statement in response to a show-cause notice from the Securities and Exchange Board of India (SEBI). The notice pertains to allegations of short-selling Adani Enterprises' stock ahead of a critical report by Hindenburg Research.

Allegations and Entities Involved

The allegations stem from US short-seller Hindenburg Research, which claimed that Kotak Mahindra Bank and its brokerage facilitated an offshore fund. This fund, allegedly managed by Kotak Mahindra (International) Ltd (KMIL), was used by an unnamed investor to profit from the decline in Adani shares following Hindenburg's report.

Entities mentioned in the notice, dated June 26, 2024, include Hindenburg, Kingdon, and K India Opportunities Fund Ltd – Class F, managed by KMIL.

Explore: Kotak Mahindra Bank Ltd Share Price

Kotak Mahindra Bank's Clarification

Kotak Mahindra Bank asserted that the transactions were executed by the fund on the advice of Kingdon, an investor. The bank stated that these transactions were conducted for Kingdon's benefit and not based on any insider information.

The bank emphasised that Kingdon did not disclose any relationship with Hindenburg nor indicate that the transactions were based on price-sensitive information.

Denial of Prior Knowledge

The bank firmly denied any prior knowledge of the Hindenburg report's publication. Further, the bank also highlighted that advice from Kingdon was purportedly based on public information and that neither the fund nor KMIL was aware of any association between Kingdon and Hindenburg.

Cooperation with SEBI

Kotak Mahindra Bank confirmed full cooperation with SEBI's investigation, stating that all relevant facts had been provided. The bank assured that the fund would present its case and its bona fides in the ongoing show-cause proceedings.

Disclaimer: Investments in the securities market are subject to market risk, read all related documents carefully before investing.

This content is for educational purposes only. Securities quoted are exemplary and not recommendatory.

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