Adani Group Calls Fraud Allegations Baseless, Bemoans Stock Moves
The energy and infrastructure conglomerate controlled by
Gautam Adani,
India’s richest man, said stock-market moves that followed allegations of fraud outlined in a report by short seller Hindenburg Research had created anguish for Indian citizens.
Adani Group
512599 -1.54%
‘s seven listed companies lost a total of $10 billion in market value on Wednesday after New York-based Hindenburg accused the Indian conglomerate of wide-ranging fraud, including the use of shell companies to manipulate its share prices. Prices of U.S. dollar bonds issued by some of those companies also fell.
Stock markets were closed in India on Thursday for Republic Day, a national holiday that commemorates the adoption of the Indian constitution following the end of British rule over the country. As Indians tuned in to an elaborate parade in New Delhi featuring an array of made-in-India weapons and an air show by the Indian Air Force, Adani Group issued a statement describing Hindenburg as a foreign entity that is trying to smear the Adani Group and shake the faith of Indian investors.
“The volatility in Indian stock markets created by the report is of great concern and has led to unwanted anguish for Indian citizens,”
Jatin Jalundhwala,
Adani Group’s head of legal, said in the statement.
The S&P BSE Sensex index fell 1.27% and the Nifty 50 index fell 1.25% on Wednesday.
The salvo followed a video message Wednesday showing Adani Group’s Chief Financial Officer
Jugeshinder Singh
standing in front of an Indian flag and denouncing the report as full of “baseless and discredited allegations.”
Hindenburg didn’t immediately respond to a request for comment on Thursday.
In releasing its report Tuesday, Hindenburg said that it conducted a two-year investigation into Mr. Adani’s business practices, and has taken a short position in the group’s companies through U.S.-traded bonds and non-Indian-traded derivative instruments.
Mr. Adani, 61 years old, is an industrialist who saw his fortunes rise over a few decades as he built a sprawling business empire that ranges from coal mining and power generation to renewable energy and ports. He is currently ranked fourth on the Bloomberg Billionaires Index. His net worth fell $6 billion to an estimated $113 billion after the Hindenburg report was released.
Mr. Jalundhwala and Mr. Singh have said Hindenburg’s allegations are intended to wreck the follow-on public offering of the group’s flagship company, Adani Enterprises.
Adani Enterprises is expected to open up its secondary share offering to retail bidders on Friday, and close the bidding on Jan. 31. The $2.5 billion FPO is India’s largest to date. The company said it would use the proceeds for capital expenditure and to pay off some debt.
Prices of some U.S. dollar bonds issued by Adani units tumbled after the Hindenburg report was released, sending their yields higher. An Adani Ports and Special Economic Zone bond that comes due in 2027 was bid at around 82 cents on the dollar on Thursday, down from 90 cents before the report’s release, according to Tradeweb data. The recent bid price reflected a yield of around 9%, versus under 7% previously.
Mr. Adani’s business interests touch the lives of millions of Indians daily: His coal mines and power plants provide electricity to huge swaths of the country, while his companies also sell the piped gas and edible oils that families use to cook meals. Last year, Adani Group struck a deal of up to $10.5 billion to buy two Indian-listed cement companies, turning his conglomerate into one of the country’s biggest producers of cement.
Hindenburg Research was founded by
Nathan Anderson.
Previous targets of its skeptical research include
Nikola Corp.
, the electric truck maker whose founder
Trevor Milton
was later convicted of securities fraud.
Write to Shan Li at [email protected] and Weilun Soon at [email protected]
Copyright ©2022 Dow Jones & Company, Inc. All Rights Reserved. 87990cbe856818d5eddac44c7b1cdeb8
The energy and infrastructure conglomerate controlled by
Gautam Adani,
India’s richest man, said stock-market moves that followed allegations of fraud outlined in a report by short seller Hindenburg Research had created anguish for Indian citizens.
Adani Group
512599 -1.54%
‘s seven listed companies lost a total of $10 billion in market value on Wednesday after New York-based Hindenburg accused the Indian conglomerate of wide-ranging fraud, including the use of shell companies to manipulate its share prices. Prices of U.S. dollar bonds issued by some of those companies also fell.
Stock markets were closed in India on Thursday for Republic Day, a national holiday that commemorates the adoption of the Indian constitution following the end of British rule over the country. As Indians tuned in to an elaborate parade in New Delhi featuring an array of made-in-India weapons and an air show by the Indian Air Force, Adani Group issued a statement describing Hindenburg as a foreign entity that is trying to smear the Adani Group and shake the faith of Indian investors.
“The volatility in Indian stock markets created by the report is of great concern and has led to unwanted anguish for Indian citizens,”
Jatin Jalundhwala,
Adani Group’s head of legal, said in the statement.
The S&P BSE Sensex index fell 1.27% and the Nifty 50 index fell 1.25% on Wednesday.
The salvo followed a video message Wednesday showing Adani Group’s Chief Financial Officer
Jugeshinder Singh
standing in front of an Indian flag and denouncing the report as full of “baseless and discredited allegations.”
Hindenburg didn’t immediately respond to a request for comment on Thursday.
In releasing its report Tuesday, Hindenburg said that it conducted a two-year investigation into Mr. Adani’s business practices, and has taken a short position in the group’s companies through U.S.-traded bonds and non-Indian-traded derivative instruments.
Mr. Adani, 61 years old, is an industrialist who saw his fortunes rise over a few decades as he built a sprawling business empire that ranges from coal mining and power generation to renewable energy and ports. He is currently ranked fourth on the Bloomberg Billionaires Index. His net worth fell $6 billion to an estimated $113 billion after the Hindenburg report was released.
Mr. Jalundhwala and Mr. Singh have said Hindenburg’s allegations are intended to wreck the follow-on public offering of the group’s flagship company, Adani Enterprises.
Adani Enterprises is expected to open up its secondary share offering to retail bidders on Friday, and close the bidding on Jan. 31. The $2.5 billion FPO is India’s largest to date. The company said it would use the proceeds for capital expenditure and to pay off some debt.
Prices of some U.S. dollar bonds issued by Adani units tumbled after the Hindenburg report was released, sending their yields higher. An Adani Ports and Special Economic Zone bond that comes due in 2027 was bid at around 82 cents on the dollar on Thursday, down from 90 cents before the report’s release, according to Tradeweb data. The recent bid price reflected a yield of around 9%, versus under 7% previously.
Mr. Adani’s business interests touch the lives of millions of Indians daily: His coal mines and power plants provide electricity to huge swaths of the country, while his companies also sell the piped gas and edible oils that families use to cook meals. Last year, Adani Group struck a deal of up to $10.5 billion to buy two Indian-listed cement companies, turning his conglomerate into one of the country’s biggest producers of cement.
Hindenburg Research was founded by
Nathan Anderson.
Previous targets of its skeptical research include
Nikola Corp.
, the electric truck maker whose founder
Trevor Milton
was later convicted of securities fraud.
Write to Shan Li at [email protected] and Weilun Soon at [email protected]
Copyright ©2022 Dow Jones & Company, Inc. All Rights Reserved. 87990cbe856818d5eddac44c7b1cdeb8
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