Black Swan author Taleb’s advice for Gautam Adani: Don’t say ‘everything is OK’

Renowned author Nassim Nicholas Taleb has offered his two cents for billionaire Gautam Adani, whose companies have been facing a massive rout in the stock market, which was triggered by a US-based short seller Hindenburg Research report. The author of The Black Swan and Antifragile in a tweet told Adani not to produce a video saying “everything is ok”. 

"Advice to Adani (& others): It (sic) everything is OK, don't produce a video saying "everything is OK"," Taleb tweeted on February 3. 

The author was referring to Adani’s video statement, which he released on Thursday, where he explained his rationale why he withdrew the fully subscribed follow-on public offer (FPO) of his group flagship Adani Enterprises. 

Adani said that investor interest is paramount, which was why they cancelled the follow-on public offer (FPO) after it was fully subscribed. He said that it would “not be morally correct” to proceed with the FPO, considering the volatility of the market.  

Adani also said that in his over four decades as an entrepreneur, he has been blessed with overwhelming support from all stakeholders.

Adani said that the decision to withdraw the FPO might have surprised many but the board opined that proceeding with the FPO would be morally wrong. “In my humble journey of over 4 decades as an entrepreneur, I have been blessed to receive overwhelming support from all stakeholders, particularly the investor community. It is important for me to confess that whatever little I have achieved in life is due to the faith and trust reposed by them. I owe all my success to them. For me, the interest of my investors is paramount and everything is secondary,” he said, adding that they decided to insulate the investors from the potential losses. 

Adani Group companies have lost around Rs 9 lakh crore m-cap in the last seven trading sessions till Friday. The total market capitalisation of the group tanked to Rs 10 lakh crore on February 3, 2023, from Rs 19.2 lakh crore as of January 24, the day Hindenburg Research made its report public. 

Adani Power, Adani Total Gas, Adani Wilmar, Adani Green, Adani Transmission, Adani Ports, Adani Enterprises, Ambuja Cements, ACC, and NDTV are the ten listed Adani Group stocks and the shares have crashed up to 50 per cent since last Wednesday. 

Shares of Adani Enterprises crashed 35 per cent in early trade on Friday after S&P Dow Jones Indices said it would exclude Adani Enterprises from widely used sustainability indices with effect from February 7. However, the stock ended 1 per cent higher on Sensex. 

Among other group stocks, Adani Total Gas fell the most to 51 per cent to Rs 1901.65 from Rs 3,885.45 during the same period, followed by Adani Green Energy, down 40 per cent, Adani Enterprises, down 38 per cent, Adani Transmission, down 37 per cent, Adani Ports and SEZ, down 35 per cent, Ambuja Cements, down 33 per cent, Adani Wilmar, down 23 per cent, Adani Power, down 22.5 per cent, ACC, down 21 per cent, and lastly NDTV, down 17 per cent.