Skip to content
Search

Latest Stories

Adani's market loss swells to $70 bln as its fight with short-seller escalates

Adani, led by Asia’s richest man Gautam Adani, has locked horns with Hindenburg Research and on Sunday hit back at the short-seller’s report of last week that flagged concerns about its debt levels and the use of tax havens.

Adani's market loss swells to $70 bln as its fight with short-seller escalates

Adani group shares extended their sharp falls on Monday as the Indian conglomerate's rebuttal of a U.S. short-seller's criticism failed to pacify investors, driving stock market losses for the companies to almost $70 billion over three days.

Flagship Adani Enterprises ADEL.NS, which is facing a crucial test this week with a follow-on share offering, fell 2.5%, reversing its initial gains of as much as 10% and staying significantly below the offer price.


Adani, led by Asia's richest man Gautam Adani, has locked horns with Hindenburg Research and on Sunday hit back at the short-seller's report of last week that flagged concerns about its debt levels and the use of tax havens. Adani said it complies with all local laws and had made the necessary regulatory disclosures.

Adani Transmission ADAI.NS, Adani Total Gas ADAG.NS, Adani Green Energy ADNA.NS, Adani Power ADAN.NS, Adani Wilmar ADAW.NS and Adani Ports and Special Economic Zone APSE.NS fell between 4.2% and 20% on Monday.

Adani Enterprises' $2.5 billion secondary share sale entered its second day amid weak investor sentiment. The stock was trading at 2,686 rupees, 13.6% below the 3,112 rupees lower end of the offer price band. The upper band is 3,276 rupees.

Initial data from stock exchanges on Monday showed Adani has now received bids for 687,840, or 1.5%, of the 45.5 million of shares on offer. The deal closes on Tuesday.

Foreign and domestic institutional investors, as well as mutual funds, have made no bids so far, according to the data.

"Retail participation is likely to have a shortfall with current market prices still trailing the offer price and sentiment taking a hit due to the Hindenburg controversy," said Hemang Jani, equity strategist at Motilal Oswal Financial Services.

"While there is a risk that the share sale does not go through, it will be crucial today to wait and see how institutional investors participate."

Adani Group told Reuters in a statement on Saturday that the sale remains on schedule at the planned issue price, even as sources said bankers of the country's largest secondary share sale were considering extending the timeline beyond Jan. 31, or tweaking the price due to the fall in its share price.

Indian regulations say the share offering must receive a minimum subscription of 90%, and if it does not the issuer must refund the entire amount. Maybank Securities and Abu Dhabi Investment Authority are among the investors who bid for the anchor portion of the issue.

Maybank said in a statement "there is no financial impact" on it as the subscription to Adani's offer was fully funded by client funds.

State-run insurance behemoth Life Insurance Corporation (LIC) LIFI.NS told Reuters on Monday it was reviewing the Adani group's response to Hindenburg's report and would hold talks with the management within days.

LIC took 5% of the anchor portion, worth around $734 million. It already holds a 4.23% stake in the flagship Adani firm, while its other exposures include a 9.14% stake in Adani Ports and 5.96% in Adani Total Gas.

"Since we are a large investor we have the right to ask relevant questions," LIC Managing Director Raj Kumar said.

DEBT, DE-LEVERAGING

Index provider MSCI has said it was seeking feedback from market participants on Adani and was monitoring the factors that "may impact the eligibility of those relevant securities" in MSCI indexes.

In its response on Sunday, Adani highlighted its relationships with local and international banks and touted its access to diverse funding sources and structures, listing U.S. banks Citigroup C.N and JPMorgan Chase & Co JPM.N and European lenders such as BNP Paribas BNPP.PA, Credit Suisse CSGN.S and Deutsche Bank DBKGn.DE.

Responding to Adani's rebuttal, Hindenburg said the "response largely confirmed our findings and ignored our key questions."

The stock market meltdown is a dramatic setback for 60-year-old Adani. The school-dropout's stunning rise came with over 1,500% gains in some of his group stocks over three years, making him the world's third richest man before he slipped to rank eighth on the Forbes list on Monday.

Hindenburg said that Adani companies had "substantial debt" and that shares in seven Adani-listed companies have an 85% downside due to what it called "sky-high valuations".

Adani's response stated that over the past decade, its group companies have "consistently de-levered".

(Reuters)

More For You

'Hundreds of million pounds can be saved by abolishing NHS'

Keir Starmer speaks with medical staff during a visit to the Elective Orthopaedic Centre at Epsom Hospital in Epsom, England. (Photo by Leon Neal/Getty Images)

'Hundreds of million pounds can be saved by abolishing NHS'


HUNDREDS of millions of pounds could be saved and patient waiting lists reduced as prime minister Keir Starmer announced plans to abolish NHS England, the body overseeing the state-funded health system.

In a speech delivered in Hull, Starmer explained his decision to streamline the National Health Service's management structure: "I can't, in all honesty, explain to the British people why they should spend their money on two layers of bureaucracy."

Keep ReadingShow less
Early risers in the UK witness stunning Blood Moon eclipse

The lunar eclipse of Friday may not have been as dramatic as the total eclipses seen in other parts of the world

iStock

Early risers in the UK witness stunning Blood Moon eclipse

In the early hours of Friday morning, stargazers across the UK were treated to a partial lunar eclipse, with many enthusiasts rising before dawn to catch a glimpse. The celestial event, which saw the Earth's shadow partially covering the Moon, began at 05:09 GMT. Although only partial for most UK observers, it still presented a spectacular sight, with western parts of the country and regions further afield, such as the Americas and some Pacific islands, witnessing the eclipse.

For some, like Kathleen Maitland, the experience was magical. Stargazing from Pagham Harbour in West Sussex, she described the beauty of watching the Moon gradually darken and transform into a reddish hue, with the sunrise unfolding behind her. The eclipse gave rise to the so-called "blood Moon," a phenomenon that occurs when the Moon moves into the Earth’s shadow, turning a dusky red as sunlight is refracted through the Earth's atmosphere.

Keep ReadingShow less
Sangam Foundation celebrates Women's Day

From L- Reetu Kabra, Maya Sondhi, Shobu Kapoor and Meera Syal during Sangam Foundation's Women's Day celebrations.

Sangam Foundation celebrates Women's Day

HUNDREDS of women gathered for the International Women's Day celebrations of Sangam Foundation last week. Prominent actresses Meera Syal, Shobhu Kapoor and Maya Sondhi have attended the event, a statement said.

The British Asian celebrities shared their experiences of breaking into an industry rife with misogyny and prejudice. The industry veterans also talked about challenges they faced in a male-dominated field.

Keep ReadingShow less
Asian tycoon Sudhir Choudhrie  backs Liberal
Democrats with £23,000

Sudhir Choudhrie

Asian tycoon Sudhir Choudhrie  backs Liberal Democrats with £23,000

BUSINESSMAN Sudhir Choudhrie has emerged as one of the biggest British Asian donors to the Liberal Democrats in the last quarter of 2024, according to the latest data from the Electoral Commission.

Choudhrie, currently an advisor on India to the leader of the Liberal Democrats, contributed on six different occasions to the party between October and December 2024, totalling more than £23,000. He contributed in a similar fashion in the previous quarter as well.

Keep ReadingShow less
Sunak is ‘content in his MP role
and has no desire to move to US’

(From left) Rishi Sunak with wife Akshata Murty, and parents Usha and Yashvir Sunak

Sunak is ‘content in his MP role and has no desire to move to US’

RISHI SUNAK “loves being an MP” and has no intention of flying to California to begin a new life in America, as his enemies alleged during the general election campaign last year.

And, unlike Boris Johnson, he is not striving to be prime minister again, even though he is still only 44.

Keep ReadingShow less