BENGALURU (Reuters) – Indian market regulators are investigating billionaire Gautham Adani’s stock crash, sources familiar with the matter told Reuters. .
Securities and Exchange Board of India (SEBI) is also watching Several allegations by Hindenburg Research and potential fraud in the sale of a significant stake by its flagship company, Adani Enterprises. (ADEL.NS) He spoke on condition of anonymity on Tuesday.
Spokespeople for SEBI and Adani Group did not immediately respond to requests for comment.
Among other allegations, Hindenberg last week accused Adani Group of using offshore tax havens and stock manipulation. also raised concerns.
in the group denied the allegationssaid the short-selling narrative of stock manipulation was “unfounded” and stemmed from ignorance of Indian law.
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On Tuesday, Adani Group raised $2.5 billion in funding from investors. stock sale For Adani Enterprises, this was seen as a sign of investor confidence during the crisis.
But the Adani Group stock and bond meltdown resumed on Wednesday, with shares of Adani Enterprises plunged 28% and Adani ports and special economic zones. (APSE.NS) It was the worst day on record for both, down 19%.
The loss represents a dramatic setback for school dropout turned billionaire Gautam Adani, whose fortune has grown rapidly in recent years to match the stock prices of his businesses, which include ports, airports, mining and cement. Increased.
The heavyweight who dropped out of the top 10 of Forbes’ richest list on Wednesday is now fighting to stabilize his company and protect his reputation.
Bloomberg said Credit Suisse (CSGN.S) Stopped accepting bonds of Adani Group companies as collateral for margin loans to private banking customers. Credit Suisse did not immediately comment.
Deven Choksey, managing director of KRChoksey Shares and Securities, said this was a big factor in Wednesday’s share price decline.
After losing $86 billion in recent days (equivalent to 16% of India’s annual budget spending of $550 billion announced on Wednesday), the market capitalization of the seven listed Adani groups is now around $131 billion. am.
[1/5] Indian billionaire Gautam Adani speaks at an inauguration ceremony after the Adani Group completed its purchase of the port of Haifa, Israel, January 31, 2023. REUTERS/Amir Cohen/File Photo
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Indian credit rating agency ICRA Ltd, a division of Moody’s Investors Service, said Wednesday it was monitoring the impact of developments on the Adani Group’s ratings portfolio.
He added that while the group’s large debt-backed capital spending plans were a “significant challenge”, some of them were discretionary in nature and could be deferred depending on liquidity conditions.
Australian regulators said Wednesday that it also revisit Hindenburg’s claims To see if further investigation is warranted.
Wednesday’s stock loss dropped Adani to 15th place on Forbes’ richest list with an estimated net worth of $75.1 billion, trailing rival Mukesh Ambani, chairman of Reliance Industries. (RELI.NS) It ranks ninth with a net worth of $83.7 billion.
Prior to Hindenburg’s report, Adani was ranked third.
Asked if he was concerned about wider losses in India’s stock market after Adani Group shares plunged, Economy Minister Ajay Seth said the government “does not comment on issues related to specific companies.” said.
India’s benchmark Nifty Index has fallen 2.7% since the Hindenberg report. The data also showed that foreign investors sold a net $1.5 billion worth of Indian equities after the report, the largest outflow for four straight days since Sept. 30.
Stocks of Adani Power (ADAN.NS) and Adani Wilmer (ADAW.NS) Adani Total Gas fell 5% each on Wednesday (ADAG.NS) 10% down, all three down to the daily price limit.Adani Transmission (ADAI.NS) decreased by 3% and Adani Green Energy (ADNA.NS) 5.6% decrease.
Adani Total Gas, a joint venture with France’s Total (TTEF.PA)was the biggest casualty of the short-selling report, losing about $27 billion.
Shares of cement company ACC (ACC.NS) and Ambuja Cement (ABUJ.NS)purchased by Adani Group from Holcim, Switzerland (HOLNS) Last year it was $10.5 billion, down 6.2% and 16.7% respectively.
Dollar bonds issued by Adani entities also resumed their decline on Wednesday. Adani Ports’ USD-denominated bond, which matures in February 2031, fell 3.59 cents to 67.58 cents, leading the loss.
Hindenburg said in a report that it had shorted Adani Group’s US Treasuries and derivatives traded outside India.
Reporting by Chris Thomas from Bangalore and Aditya Kalra and Aditi Shah from New Delhi. Additional reporting by Bharath Rajeshwaran, Nikunj Ohri, and Sethuraman NR. Edited by Edwina Gibbs, Aditya Kalra, Mark Potter
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