India’s Adani group experienced substantial market value erosion, losing $12.5 billion on Friday following a procedural motion by the U.S. Securities and Exchange Commission (SEC). The SEC sought a court’s help to serve summonses to key group figures including founder Gautam Adani and executive director Sagar Adani. The action is connected to an ongoing civil lawsuit alleging fraud and a bribery scheme worth $265 million.
This procedural request was disclosed by the SEC after Indian market hours on Thursday, signaling renewed pressure on the group. The following trading day saw Adani Enterprises, the flagship entity within the group, emerge as the steepest percentage decliner on India’s benchmark Nifty 50 index. Its shares dipped by 10.65 percent, closing at 1,864.2 rupees, while the broader Nifty 50 fell by 0.95 percent.
The broader Adani group’s stocks retreated within a range of 3.4 percent to 14.54 percent by market close. The legal claims against Adani executives date back to November 2024 when U.S. authorities accused them of engaging in bribery directed at Indian officials to secure contracts for Adani Green Energy, a subsidiary of the group responsible for electricity production.
It is important to note that the SEC’s civil case is distinct from a parallel criminal indictment filed by the U.S. Department of Justice, which is still active according to court documents. U.S. law strictly prohibits companies raising capital from American investors from bribing foreign officials or soliciting investments through deceptive means.
The SEC encountered resistance in serving summonses directly in India as the government reportedly denied two service requests. Consequently, the regulator petitioned the U.S. court to authorize serving legal notices through the Adanis’ U.S.-based legal representatives and via email to their business addresses. The SEC justified this approach by pointing to the defendants’ demonstrated awareness of the litigation through public disclosures and ongoing engagement of U.S. counsel.
Representatives of the Adani group have labeled the SEC’s allegations as completely unfounded and expressed commitment to utilizing full legal avenues to contest the accusations. At the time of reporting, the group had not commented on the SEC’s most recent filing dated January 21.
Market analysts observed that investors had previously assumed the legal matters were resolved or inactive, making the SEC’s recent filing appear unexpected. With an uncertain timeline for future developments, some expect the legal challenges to persist for at least another two weeks while noting that market sentiment was already subdued.