Adani Group shares slide further as Hindenburg row heats up

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Adani Group shares slide further as Hindenburg row heats up
Credit: © Reuters.

By Ambar Warrick 

Investing.com -- Shares of the seven listed companies under Adani Group slid further on Friday after the release of a short seller report earlier this week, with a response from the Indian conglomerate doing little to curb the market rout.

Adani Transmission Ltd (NS: ADAI ) and Adani Total Gas Ltd (NS: ADAG ) were the worst hit, falling 14.5% and 17.6%, respectively, while Adani Green Energy Ltd (NS: ADNA ) tumbled nearly 13%. Adani Wilmar Ltd (NS: ADAW ) and Adani Power Ltd (NS: ADAN ) lost 5% each, while Adani Enterprises Ltd (NS: ADEL ) and Adani Ports and Special Economic Zone Ltd (NS: APSE ) lost 4.8% and 5.5%, respectively.

The conglomerate denied the allegations of fraud and market manipulation raised by the Hindenburg report, and said it was considering legal action against the short seller, calling the report "maliciously mischievous, and unresearched” in a statement released to Indian exchanges.

Hindenburg in turn said it welcomed the threat of legal action, inviting the conglomerate to file suit in the U.S.

“We have a long list of documents we would demand in a legal discovery process,” Hindenburg said in a statement posted on Twitter.

The 106-page report called Adani the “largest corporate con in corporate history,” and raised concerns over the conglomerate’s highly leveraged debt position, which it said represented an at least 85% overvaluation in its stock prices.

The report also accused Adani of fraud and stock market manipulation, and claimed that Indian regulators were complicit in the fraud. 

Adani Group’s shares had plummeted on Wednesday after the release of the report, with the firm’s U.S.-listed bonds also declining. Hindenburg said it had no direct exposure to Adani shares, and had taken a short position in the firm through its U.S. bonds and other derivatives. 

The Hindenburg report came just days before Adani commenced a $2.45 billion secondary share sale. 

Selling spilled over to broader Indian markets, with both the BSE Sensex 30 and Nifty 50 indexes falling 0.9% and 1.1%, respectively. Indian bank stocks bore the brunt of selling, as markets also feared a potential contagion in the sector from any losses in Adani.

 

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  • Bhavesh patel @Bhavesh patel
    Can anyone have clue why hidenburg had shortsell adani shares and then published the report ? they might have publish without shortselling it would be more effective , understand the stand, west want to disturb Indian markets..
    Like 0
  • Dr Fin @Dr Fin
    India didn't tow west's line on the Ukraine war. Rather, India called out west's hypocrisy vis-a-vis west's response to various crises pertaining India (terrorism by Pak, China LAC violations etc). This is west's way of getting back at India.Indian investors need to learn to read between the line.
    Like 3
    • Dr Fin @Dr Fin
      Under Modi India's steady rise in economic, geopolitical heft has sent alarm bells in the chauvinistic west. Hindenburg report questions our financial system, attempts to dent India's economic system. BBC documentary questions our judiciary, attempts to taint Indian leadership.
      Like 2

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  • Abode the Living Space @Abode the Living Space
    people should understand,in very short span of time Adani s wealth is 1000 times growing,this is only possible because of PUMP and Dump strategy, use operators to do ... Indian Government should look into ... else individual investors would be loss there trust in regulatory.
    Like 0
  • Amit kumar @Amit kumar
    Lack of knowledge in the india people. They don’t know , how the fabricated news spread by so called theif country USA. Indian people wake up.
    Like 2
  • Rakesh Prasad @Rakesh Prasad
    Oh my god, i have gone through hidenburg report. Never knew Adani and his family involve this much in corruption ( better say crime) under the nose of sebi and govt.
    Like 2
    • PK Ray @PK Ray
      @Rakesh Prasad Adani is backed by Govt and SEBI. See the rise in the last 3 years
      Like 0

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  • Vivek Purushothaman @Vivek Purushothaman
    Pump and dump story of Adani is finally exposed with supporting documents. All credit goes to Hindenberg’s well reserached report. SEBI and Banks going to have sleepless nights hereafter for a while.
    Like 2
    • Narayanapillai Jayakumar @Narayanapillai Jayakumar
      @Vivek Purushothaman 5 year old company with starting with 4 employees, known market manipulatior done "wide research". Make some sense?
      Like 0

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  • Gautam Banerjee @Gautam Banerjee
    Manipulation story is all bunkum in the Indian Stock Market.
    Like 0

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