Adani Group hits back with detailed responses to Hindenburg's unsubstantiated accusations

  • IANS
  • Stock Market News
Adani Group hits back with detailed responses to Hindenburg's unsubstantiated accusations
Credit: © Reuters.

New Delhi, Jan 29 (IANS) On Sunday, Adani Group responded to unsubstantiated allegations and misleading narrative peddled by Hindenburg Research at length in an over 400-page response backed by relevant documents.

Adani Group's response also raises the questions against the ulterior motives and modus operandi of Hindenburg that has conveniently ignored the Indian judiciary and regulatory framework.

The detailed response from Adani Group covered its governance standards, credentials, creditworthiness, best practices, transparent conduct, financial and operational performance and excellence.

The Hindenburg report has been made with a clear intent to profiteer at the cost of our shareholders and public investors. Its report is neither "independent" nor "objective". It is a manipulative document that is rife with conflict of interest and intended only for creating a false market in securities to book wrongful gain, which clearly constitutes securities fraud under Indian law.

Of the 88 questions posed by Hindenburg, it is pertinent to note that 68 refers to the matters that have already been duly disclosed by Adani Group companies in their respective annual reports, offering memorandums, financial statements and stock exchange disclosures from time to time. Sixteen out of 20 questions are pertaining to public shareholders and their sources of funds, while the balance four are simply baseless allegations.

Needless to say that Hindenburg has created these questions to divert the attention of its target audience while managing its short trades to benefit at the cost of investors. The report claims to have undertaken a "2-year investigation" and "uncover evidence", but comprises nothing other than selective and incomplete extracts of disclosed information which has been in the public domain for years.

"We take serious objection to Hindenburg that chose to mislead the investors, watchdogs and policy makers at a time when Adani Group has launched country's largest FPO. Adani Group is deeply committed to its stakeholders, and it is thankful to them for standing with us over the past 30 years. Shockingly, Hindenburg Research's attack on the trust of Adani Group's stakeholders undermines its commitment for the 'Growth with Goodness'," Adani Group said.

Hindenburg Research has come up with a document covering selective and twisted extracts of already disclosed information to raise questions in the minds of Indian and global investors to mislead them about Indian growth story. It is an attack on the trust of Adani Group's stakeholders undermines its commitment for the 'Growth with Goodness'.

Adani Portfolio companies have successfully and repeatedly executed an industry beating expansion plan over the past decade. While doing so, the companies have consistently de-levered with portfolio net debt to EBITDA ratio coming down from 7.6x to 3.2x, EBITDA has grown 22 per cent CAGR in the last 9 years and debt has only grown by 11 per cent CAGR during the same period.

Equity Injection in the Adani Portfolio Adani Portfolio has raised $16 billion equity under a systematic capital management plan for all the Portfolio companies over the last 3 years as a combination of primary, secondary and committed equity from marquee investors like TotalEnergies, IHC, QIA, Warburg Pincus etc.

The portfolio has developed deep bank relationships with institutions such as JP Morgan, Bank of America (NYSE: BAC ) Merrill Lynch, Citi, CreditSuisse, UBS, BNP Paribas (EPA: BNPP ), Deutsche Bank (ETR: DBKGn ), Barclays (LON: BARC ), Standard Chartered (LON: STAN ), MUFG, DBS and Emirates NBD among others. This has strengthened access to diverse funding sources and structures.

Adani Portfolio companies have demonstrated successful syndication of the banking transactions, resulting in de-risking of the banks in volatile markets. Case in point being Holcim (SIX: HOLN )'s Indian cement business acquisition with international banks, and Navi Mumbai Airport and Kutch Copper refinery with domestic banks Adani Group companies also have a very strong audit process in order to prevent any deviations from the regulatory obligations and highest legal standards.

The Audit Committee of each of the listed verticals is composed of 100 per cent of Independent Directors and chaired by Independent Director.

The Statutory Auditors are appointed only upon recommendation by the Audit Committee to the Board of Directors. Adani Portfolio company's follow a stated policy of having global big 6 or regional leaders as Statutory Auditors.

Hindenburg has deliberately and repeatedly trivialised the change of CFOs to twist this into a narrative.

The fact is that many of the CFOs are still part of the organisation in other capacities to take on larger responsibilities as part of our growth stories.

Others have left post retirement or to pursue their own entrepreneurial endeavours and continue to work in our association.

None of the resignations have ever been made pursuant to any alleged concerns and Hindenburg's baseless narrative.

--IANS

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  • Vivek Purav @Vivek Purav
    Adani, first of all, should not have indulged in the blame game conversation. Simply should have taken a press conference and should have put all reports on public dominant, and one sentence was enough, i.e., Adani is so strong that people make fudge statements to own co at discounted price.
    Like 0
  • Rakesh Prasad @Rakesh Prasad
    None of the questions is answered raised by Hidenburg. Only misleading narrative.
    Like 3
  • Pankaj Jambusaria @Pankaj Jambusaria
    Very Good. We must save our country from foreign influence. Those Monkeys are nobody to give opinion about our companies. I clearly remember about one such research firms prediction that Silver will be in huge demand in coming years as it finds use in electronics industry. The prices of Silver shot up by 3.5 times only to go down in next 6 months. The whole world knows, whi gained from such reports.Government should Ban Short Selling immediately. Every sell and purchases must be supported by actual transaction of give and take of stocks. It should not be on paper.This can protect our country’s share market to some extent.
    Like 3
  • Aki @Aki
    BTW Y SEBI never questions elevated debt levels especially when bank exposure is large that can cause panic in economy?
    Like 5
    • Aki @Aki
      Anyone will short if there is clear opportunity. In India you can shorting only via futures and options. Naked shorting is not permitted. So SEBI can stretch its muscles to track same.
      Like 0
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  • Kasiviswanadh Reddy @Kasiviswanadh Reddy
    it is not Hindenburg I am sure it is Hidenburg.
    Like 0
    • didwania Sandeep gmail @didwania Sandeep gmail
      It is Hindenburg
      Like 2
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  • makarand Nnn @makarand Nnn
    If Adani was what it claims to be it would have not been targetted in the first place. Just because somebody is benefitting by shorting does not change the fact that this company has not been transparent about a lot of things. Why have they not published the list of CFO's allong with other details then???!
    Like 3
  • This & BBC episode are nothing but part of Pappu congress Kerosene toolkit announced by him few months back
    Like 4
  • Mohanrao Sikhakolli @Mohanrao Sikhakolli
    Hindenburg had it's own ajenda towards disturbing indian economy
    Like 6
  • Ajay Singh @Ajay Singh
    If they are so right then why they are not filing the same at US court ??
    Like 5
  • Vipin Kumar @Vipin Kumar
    Need to trade carefully in these conditions
    Like 2
  • Dharmesh Pancholi @Dharmesh Pancholi
    20% upper freezeFor sure👍
    Like 0
  • AK Trading Academy Palanivel @AK Trading Academy Palanivel
    well explained
    Like 2

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