‘A smoking gun’: Top lawyer points to ‘Chinese connection’ in Hindenburg hit job against Gautam Adani

Senior lawyer Mahesh Jethmalani has labeled a “smoking gun” in the Hindenburg episode, alleging a ‘Chinese connection’ that commissioned the report that caused Adani Group shares to plummet.

Sebi this week had revealed that Kingdon Capital Management LLC, a foreign portfolio investor, helped Hindenburg indirectly target Adani Enterprises Ltd.

In a detailed post on X, Jethmalani stated that Mark Kingdon, who runs Kingdon Capital Management LLC, hired Hindenburg to create the Adani Group report.

Jethmalani’s “smoking gun” is Mark Kingdon’s wife, Anla Cheng, a Chinese-American with significant shares in Kingdon Master Fund.

She is a lobbyist for Chinese interests in the US. “She was the CEO of #SupChina, a pro-China media initiative, which became The China Project after a whistleblower accused it of news subversion for China before the US Congress,” Jethmalani wrote.

Jethmalani suggested that Cheng and Kingdon’s actions were driven by the Adani Group blocking Chinese interests worldwide, including outbidding Chinese firms for Israel’s Haifa Port and coal projects near Sri Lanka’s Jaffna.

“The latter clearly has a bone to pick with the Adani group,” he claimed.

He posed three key questions:

• “Who introduced the Kingdons to KMIL, what due diligence did KMIL conduct on the Kingdons, and did it participate in the short sell as a principal?”
• “Did all the Indian individuals and entities who helped Hindenburg know about the short-selling plan and benefit from it?” Jethmalani hinted at political figures, implying the opposition might be involved.
• “Did these people and entities know about the Chinese link?”

Sebi, in its notice to Hindenburg Research LLC, accused the organization of misrepresentations and selective disclosures to cause panic in Adani share prices. Hindenburg denied informing Kingdon about the report before it was released and claimed Kingdon did not share trading information with them. It was claimed that Kotak Mahindra Group created and oversaw the offshore fund structure used by its investor partner to short Adani stocks.

However, the claim was denied by Kotak Mahindra Bank.

“Hindenburg has never been a client of the firm nor has it ever been an investor in the fund. The Fund was never aware that Hindenburg was a partner of any of its investors. KMIL has also received a confirmation and declaration from the Fund’s investor that its investments were made as a principal and not on behalf of any other person,” a spokesperson of Kotak Mahindra International Limited clarified.