📈 69% of S&P 500 stocks beating the index - a historic record! Pick the best ones with AI.See top stocks

Adani Group shares slide further as Hindenburg row heats up

Published 27/01/2023, 05:27
© Reuters
IND50
-
NSEI
-
ADEL
-
ADAN
-
APSE
-
BSESN
-
ADAI
-
ADNA
-
ADAG
-
ADAW
-

By Ambar Warrick 

Investing.com -- Shares of the seven listed companies under Adani Group slid further on Friday after the release of a short seller report earlier this week, with a response from the Indian conglomerate doing little to curb the market rout.

Adani Transmission Ltd (NS:ADAI) and Adani Total Gas Ltd (NS:ADAG) were the worst hit, falling 14.5% and 17.6%, respectively, while Adani Green Energy Ltd (NS:ADNA) tumbled nearly 13%. Adani Wilmar Ltd (NS:ADAW) and Adani Power Ltd (NS:ADAN) lost 5% each, while Adani Enterprises Ltd (NS:ADEL) and Adani Ports and Special Economic Zone Ltd (NS:APSE) lost 4.8% and 5.5%, respectively.

The conglomerate denied the allegations of fraud and market manipulation raised by the Hindenburg report, and said it was considering legal action against the short seller, calling the report "maliciously mischievous, and unresearched” in a statement released to Indian exchanges.

Hindenburg in turn said it welcomed the threat of legal action, inviting the conglomerate to file suit in the U.S.

“We have a long list of documents we would demand in a legal discovery process,” Hindenburg said in a statement posted on Twitter.

The 106-page report called Adani the “largest corporate con in corporate history,” and raised concerns over the conglomerate’s highly leveraged debt position, which it said represented an at least 85% overvaluation in its stock prices.

The report also accused Adani of fraud and stock market manipulation, and claimed that Indian regulators were complicit in the fraud. 

Adani Group’s shares had plummeted on Wednesday after the release of the report, with the firm’s U.S.-listed bonds also declining. Hindenburg said it had no direct exposure to Adani shares, and had taken a short position in the firm through its U.S. bonds and other derivatives. 

The Hindenburg report came just days before Adani commenced a $2.45 billion secondary share sale. 

Selling spilled over to broader Indian markets, with both the BSE Sensex 30 and Nifty 50 indexes falling 0.9% and 1.1%, respectively. Indian bank stocks bore the brunt of selling, as markets also feared a potential contagion in the sector from any losses in Adani.

 

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.