'Our resilience was tested... our response was extraordinary': Gautam Adani shares insights about Hindenburg-hit 2023

Billionaire Gautam Adani has recently said that the year 2023 was a year of "extraordinary contrasts" for the ports-to-energy conglomerate. Addressing the company's employees in a video message, Adani said that the group overcame attacks by an international short seller and various groups opposed to Adani's interests. He said that the conglomerate emerged from this tumultuous period in a "position of unprecedented strength".

"About 12 months ago, our resilience was tested by an attack from an international short seller. This was further complicated as various groups with opposing interests to Adani leveraged the short seller's claim for their own objectives, aiming to harm our reputation by raising concerns about governance practices not just for our group but at the national level," Adani said.

"While there is a need to incorporate learnings into our processes to avoid such challenges in the future, our group's response to the short seller attack was extraordinary. We not only rebounded but also reported record-breaking results, ending our most challenging year in a position of unprecedented strength," Adani said as mentioned in a news report on NDTV.

He added the conglomerate's integrity and governance were thoroughly validated by a Supreme Court-appointed committee. The committee's report found no regulatory failure in the Hindenburg-Adani matter, underscoring the unsubstantiated nature of the allegations against the group. Adani highlighted that this experience only served to highlight the power of truth in their favour.

The Adani Group has been entangled in controversy since January 2023 when US-based Hindenburg Research alleged corporate misgovernance, among other charges. Following which, Adani witnessed the biggest wealth loss in 2023, losing over 30 per cent of his net worth due to the Hindenburg Research report. 

In its report, Hindenburg Research said that Adani Ports was the only listed entity in the group “with significant reserves” at Rs 86 billion at that time. It highlighted stock prices of the seven key Adani listed companies, including Adani Ports, which “mysteriously surged” in the past three years.  

However, Adani paved a quick recovery, raising almost $15 billion in debt and equity in 2023.

Adani, in the video message, said: "While there is a need to incorporate learnings into our processes to avoid such challenges in the future, our group's response to the short seller attack was extraordinary. We not only rebounded but also reported record-breaking results, ending our most challenging year in a position of unprecedented strength." 

The Adani Group companies saw a remarkable surge in operating income, reaching over Rs 43,000 crore, a 47 per cent increase in the first half of FY24.

After the Hinderburg fiasco, Star investor GQG Partners bought stakes worth almost $4.3 billion in five group companies between March and August while Qatar Investment Authority (QIA) and French energy giant TotalEnergies poured in $770 million in renewable energy firm Adani Green Energy Ltd, the company announced through stock exchange filings.

Adani further said: "Our financial health is now far more robust than ever before in our 30-year history and is marked by an expansion of our investor base with prestigious global entities like GQG Partners from the U.S., International Holding Co. from the Middle East, Total Energies from Europe, and the U.S. government's International Finance Development Corp."

The acquisition of Ambuja Cement and ACC was also a turning point for Adani Group, after which the $3.5 billion debt to fund the deal was refinanced, increasing the firm's bankability.

During the first half of FY24, the Adani Group companies experienced a significant increase in operating income, surpassing Rs 43,000 crore. This represents a remarkable 47 per cent surge compared to previous periods. Following the Hinderburg fiasco, renowned investor GQG Partners made substantial investments totaling nearly $4.3 billion in five group companies between March and August. Additionally, Qatar Investment Authority (QIA) and TotalEnergies, a prominent French energy company, injected $770 million into Adani Green Energy Ltd for its renewable energy projects. The acquisition of Ambuja Cement and ACC marked a pivotal moment for the Adani Group as it refinanced its debt of $3.5 billion to enhance its bankability.

Furthermore, the Adani Group expanded its portfolio through strategic acquisitions such as Sanghi Cement for $431 million, a 49.38 per cent stake in Indian Oil Tanking for $128 million, Karaikal port for $181 million, and Coastal Energen for $420 million. 

Gautam Adani's net worth

Prior to the Hindenburg report controversy, Gautam Adani's net worth stood at an impressive $110 billion. Yet after the release of the report, he incurred a loss of approximately 34 per cent of his wealth. Currently ranked as India's second richest individual after Mukesh Ambani from Reliance Industries according to Forbes data, Gautam Adani holds a net worth of $72.5 billion.

 

Also read: Adani Ports, ICICI Bank, JSW Energy, Bharti Airtel shares among Jefferies' top India 2024 picks

Also watch: Year Ender 2023 | What made headlines in world of business: Adani-Hindenburg Report row, Twitter rebrands as X, Narayana Murthy sparks 70-hour work week debate, birth of Reliance’s Jio Financial

Also read: Mukesh Ambani gains, Gautam Adani takes a hit in comeback year for richie rich

 
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