Hindenburg Research's report alleging accounting frauds, stock manipulations and money laundering by the Adani group wiped out Rs 2.37 lakh crore from the group market capitalisation in a span of just two days. Adani Total Gas, the most vauled group stock, saw its m-cap falling by Rs 76,000 crore in two days; Adani Transmission saw its m-cap plunging by Rs 63,700 crore. These two Adani group stocks were heavily battered in Friday's trade, tanking up to 15 per cent.
In total, m-cap of 10 Adani group stocks have fallen 12 per cent to Rs 16.83 lakh crore from Rs 19.20 lakh crore as on January 24.
At 9.57 am, shares of Adani Transmission were trading 13.41 per cent lower at Rs 2,175. Adani Total Gas was down 14.88 per cent at Rs 3,118.60. Flagship Adani Enterprises, whose Rs 20,000 crore follow on public offer kicked off today, fell 2.38 per cent to Rs 3,309.15.
Adani Wilmar hit its 5 per cent lower circuit limit at Rs 517.30. Adani Ports declined 3.21 per cent to Rs 690.05. Adani Green was down 9.55 per cent at Rs 1,678.30. Adani group's cement stocks ACC and Ambuja Cements fell 5-5.5 per cent each. NDTV hit a 5 per cent lower circuit at Rs 256.35.
Adani Green lost Rs 35,562 crore in market value in the two trading sessions to Friday. Adani Ports & SEZ and Adani Enterprises lost over Rs 14,000 crore each in market values. Ambuja Cements and Adani Power erased Rs 10,000 crore each in market value. Adani Wilmar and ACC lost up to Rs 7200 crore in market capitalisation.
Adani group called Hindenburg's report as maliciously mischievous and unresearched, which, it said, adversely affected the Adani Group, its shareholders and investors. But Billionaire investor William Ackman in a tweet on Thursday said he found short-seller Hindenburg Research's report on Adani Group "highly credible and extremely well researched."
Hindenburg Research report talked about Gautam Adani’s brother Rajesh Adani and brother-in-law Samir Vora, who it said played key roles in the diamond trading import/export scheme using offshore shell entities to generate artificial turnover. Adani's brother Vinod Adani, found at the centre of government investigations “regularly”, manages a network of offshore entities that have collectively moved billions of dollars into Adani’s publicly listed and private entities, Hindenburg Research said. These companies engage in stock parking and manipulation, and money laundering through the private companies into the listed ones, Hindenburg Research said.
Adani group had said that the timing of the Hindenburg report’s publication clearly betrays a brazen, mala fide intention to undermine the group’s reputation with the principal objective of damaging the follow-on public offering from Adani Enterprises, which is the biggest FPO ever in India.
"The investor community has always reposed faith in the Adani Group on the basis of detailed analysis and reports prepared by financial experts and leading national and international credit rating agencies. Our informed and knowledgeable investors are not influenced by one-sided, motivated and unsubstantiated reports with vested interests," it had said.
Jatin Jalundhwala, Group Head - Legal at Adani in a media statement on Thursday said that his group was evaluating the relevant provisions under US and Indian laws for remedial and punitive action against Hindenburg Research.
To this, Hinderburg said the Adani group has not addressed a single substantive issue that it raised.
"Regarding the company's threats of legal action, to be clear, we would welcome it. We fully stand by our report and believe any legal action taken against us would be meritless. If Adani is serious, it should also file suit in the US where we operate. We have a long list of documents we would demand in a legal discovery process," Hindenburg said.
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